Crown Pacific wins CIT's support for Alliance Lumber sale subject to DIP repayment

By Jeff Pines

Washington, July 6 - Crown Pacific Partners LP's proposed sale of its Alliance Lumber assets in Reno, Nev. and Phoenix won the support of CIT Group/Business Credit, Inc. as long as Crown Pacific pays off the $11.8 million balance on its debtor-in-possession revolver. The $11.8 million balance was as of June 29, CIT said in a July 2 filing with the U.S. Bankruptcy Court for the District of Arizona.

The proposed buyer is ALC Acquisition LLC, which is controlled by True Carr, who founded Alliance in 1984 and sold it to Crown Pacific in 1998. Carr has obtained a commitment letter for a $32 million revolver through Wells Fargo Bank NA.

Crown Pacific said that fluctuations in the business' inventories and receivables make it difficult to place a precise figure on the sale price but added that if the sale had closed on May 31 it would have netted about $45 million.

Crown Pacific said it believes ALC's offer is the highest, the best and possibly only offer.

In most asset sales an auction is held with a stalking horse bidder but in this case Crown Pacific believes an auction is unnecessary.

A July 13 hearing is scheduled.

Crown Pacific filed for bankruptcy on June 29, 2003. Its Chapter 11 case number is 03-11258.

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