Caraustar Industries to Close York, Pennsylvavia, Carton Plant

Atlanta, Georgia, USA, 27 November 2006 -- /PRNewswire/ -- Caraustar Industries, Inc. (NASDAQ:CSAR) today announced the closure of its York Carton Plant in York, Pennsylvania, as part of the company's previously announced consolidation in its converted products group, comprised of the tube and core and custom packaging businesses.

Caraustar expects to consolidate most of the York plant's production into other existing Caraustar folding carton locations to generate increased efficiency and operational effectiveness.

The company will record a pre-tax charge of approximately USD 4.0 million, of which approximately USD 2.6 million will be non-cash, in association with this closure. Further, the company expects to generate an estimated USD 1.3 to USD 1.5 million in annual pre-tax savings, part of a previously announced savings of USD 5.9 million in its converting business.

The closure of the York plant will affect approximately 61 salaried and hourly employees. Caraustar will provide a comprehensive program of separation pay, benefits coverage, and job assistance to affected employees to facilitate their transition.

Caraustar, a recycled packaging company, is one of the world's largest integrated manufacturers of converted recycled paperboard. It 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, cores, and composite cans; folding cartons; gypsum facing paper and other specialty paperboard products. For additional information on Caraustar, visit the company's website at www.caraustar.com.

Source: Caraustar Industries, Inc.