Displaying items by tag: bankruptcy

The operator of three newsprint mills in Quebec, White Birch Paper Company, has filed for creditor protection in Canada and the U.S., to improve its capital structure.

White Birch Paper is the parent company of the F.F. Soucy mill in Rivière-du-Loup, the Stadacona mill in Quebec, and Papier Masson in Gatineau. The company's U.S. subsidiary, Bear Island Paper Company, also filed for relief under Chapter 11 of the United States Bankruptcy Code.

"This process is about fixing our capital structure," said Christopher Brant, president. "We remain committed to delivering the highest quality product to our many valued customers, and through this financial restructuring, we believe we will be better positioned to continue to do so well into the future."

White Birch expects operations to continue as usual during and after the restructuring process.

The company is seeking approval in Canada and the U.S. of a $140 million in debtor-in-possession (DIP) financing.
White Birch Paper is the second largest newsprint producer in North America. It cites a decline in demand for newsprint, combined with a decline in prices, as well as the increased strength of the Canadian dollar, as having a negative impact on its business. AbitibiBowater, another large newsprint producer in North America, is also operating under bankruptcy protection

Fraser Papers Inc. ("Fraser Papers" or the "Company") announced today that, following the extended deadline of January 26, 2010, it had received no additional offers to purchase the Company's specialty papers business (the "Business") under the court supervised sale process (the "Bid Process"). As a result, Fraser Papers has terminated the Bid Process and will continue to work diligently to clear the remaining conditions and complete the firm purchase offer sponsored by the Company's secured creditors that was signed on December 22, 2009 (the "Purchase Agreement").

The Bid Process was approved by the Ontario Superior Court on December 10, 2009 and by the U.S. Bankruptcy Court for the District of Delaware on January 5, 2010. Pursuant to the Bid Process, PricewaterhouseCoopers Inc., the court-appointed Monitor, actively marketed the Business contacting 133 potential acquirers and overseeing the due diligence process with a number of interested parties. While a number of parties expressed preliminary interest, none of them submitted letters of intent. PricewaterhouseCoopers Inc. is expected to issue a report next week providing more details on the results of the Bid Process.

Under the terms of the Purchase Agreement, the unsecured creditors of Fraser Papers will receive ten-year promissory notes and a 49% common equity interest in the new company ("Newco"). Brookfield Asset Management Inc., a secured creditor, has agreed to convert its secured claim against the Company into a 51% common equity interest in Newco while the Government of New Brunswick has agreed to convert its $35 million secured loan plus accrued interest into equity in the form of preferred shares of the new company. Newco and the Company are currently negotiating a $50 million revolving credit facility with CIT Business Credit Canada Inc., which will provide Newco with operating liquidity.

Fraser Papers is an integrated specialty paper company that produces a broad range of specialty packaging and printing papers. The Company has operations in New Brunswick, Maine, New Hampshire and Québec. For more information, visit the Fraser Papers web site at www.fraserpapers.com.

Contacts:

Peter Gordon
Chief Executive Officer
(416) 359-8614

This email address is being protected from spambots. You need JavaScript enabled to view it.

Glen McMillan
Senior Vice President and Chief Financial Officer
(416) 359-8635

This email address is being protected from spambots. You need JavaScript enabled to view it.