R.R. Donnelley Argentina files for bankruptcy after alternatives fail

By Caroline Salls

Pittsburgh, Aug. 18 – R.R. Donnelley & Sons Co. subsidiary R.R. Donnelley Argentina SA filed for bankruptcy on Aug. 11 with an Argentine court, according to a news release.

R.R. Donnelley & Sons president and chief executive officer Thomas J. Quinlan said the decision for the subsidiary to file bankruptcy was made after consideration of many alternatives to preserve operations.

According to the release, the printing industry in Argentina has been struggling to be profitable for some time, and the outlook for improvement of industry sales is not positive.

The company said R.R. Donnelley Argentina’s business is not solvent. The subsidiary has experienced a decrease in sales and does not foresee any improvement in the foreseeable future.

The parent company said R.R. Donnelley Argentina obtained a reproduction program in September 2013, but the local union elected not to sign it, thereby preventing the proposed corrective actions and worsening its economic and financial situation even more.

R.R. Donnelley said the subsidiary has had multiple meetings with the national and local unions in advance of filing bankruptcy, seeking a crisis-prevention plan that called for a reduction of head count in order to draw closer to profitability, but no solutions were acceptable to the unions.

In addition, R.R. Donnelley Argentina met with and filed a petition with the National Ministry of Labor proposing a reduction in head count at its facility. This request was also brought to the Provincial Ministry of Labor. Before the bankruptcy filing, both Ministries of Labor said they did not support the proposal.

As a result, the company said R.R. Donnelley had no other solutions for rising labor costs, inflation, materials price increases, devaluation, inability to pay debts as they come due and other issues other than the bankruptcy filing.

R.R. Donnelley & Sons is a Chicago-based provider of integrated communication services.

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