Atlanta, Georgia, USA, 19 March 2009 -- /PRNewswire-FirstCall/ -- Caraustar Industries, Inc. (Nasdaq: CSAR) has decided to permanently cease production of uncoated recycled boxboard (URB) at its Carolina Paperboard mill in Charlotte, North Carolina. Production was ceased effective today.

The company had previously announced, on 11 December 2008, the idling of the Carolina Paperboard mill. The mill had an annual capacity of approximately 62,000 tons. The company will continue to service customers and their needs from other Caraustar locations.

Associated with this closure, the company will record a pretax charge of approximately USD 9.7 million, of which USD 7.3 million will be noncash. It is expected that the rationalization of this facility will generate USD 11.4 million in annual pretax savings.

The closure of the Carolina Paperboard mill will affect approximately 111 salaried and hourly employees. Caraustar will provide a comprehensive program of separation compensation, benefits coverage, and job assistance to the employees affected by the closure to facilitate their transition to alternate employment.

In making the announcement, Greg Bartlett, vice president, sales Mill Group, stated, "In December, we announced that we were idling the Carolina Paperboard mill and would monitor demand in order to determine whether it was feasible to resume production at the facility. In this increasingly challenging economic environment, it is not economically prudent to resume paperboard production or to continue to keep the paper machine idle. Our focus continues to be on our customers. We are committed to providing superior customer service."

Caraustar Industries, Inc. is one of North America's largest integrated manufacturers of 100% recycled paperboard and converted paperboard products. The company is a socially responsible corporation, is committed to environmentally sound practices, and is dedicated to providing customers with outstanding value through innovative products and services. Caraustar has developed its leadership position in the industry through diversification and integration from raw materials to finished products. Caraustar serves the four principal recycled boxboard product end-use markets: tubes and cores, folding cartons, gypsum facing paper, and specialty paperboard products. For additional information on Caraustar, visit www.caraustar.com.