Geo Specialty Chemicals bondholders to get an estimated 44% recovery

By Jeff Pines

Washington, Nov. 2 - Geo Specialty Chemicals Inc.'s bondholders will get an estimated 44% recovery, according to the company's disclosure statement.

The company filed its disclosure statement and reorganization plan with the U.S. Bankruptcy Court for the District of New Jersey Monday.

The Harrison, N.J.-based chemical company estimates there are $127.7 million of 10 1/8% senior subordinated note claims. The noteholders will exchange their notes for the reorganized company's common stock.

Equity interests will be cancelled.

Geo Specialty's plan proposes a $125 million five-year exit facility with an interest rate of three-month Libor plus 850 basis points with a 100 basis point commitment fee.

The proposed lenders are Merrill Lynch Global Investment Series - Income Strategies Portfolio, Debt Strategies Fund Inc., Senior High Income Portfolio Inc., Master Senior Floating Rate Trust, Floating Rate Income Strategies Fund Inc., Floating Rate Income Strategies Fund II Inc., or the Merrill entities, Stanfield Capital, Airlie Opportunity Fund, Quadrangle Debt Recovery Income Fund Master Ltd., and QDRF Master Ltd.

At least one of the Merrill entities, or their affiliates, and Airlie Opportunity Fund own 10 1/8% notes.

Geo Specialty filed for bankruptcy on March 18, 2004. Its Chapter 11 case number is 04-19148.

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