Mecachrome International CCAA restructuring plan approved by court

By Caroline Salls

Pittsburgh, Sept. 1 - Mecachrome International Inc. has received a sanction order from the Superior Court of the Province of Quebec approving the company's proposed debt and capital restructuring plan under the Companies' Creditors Arrangement Act and the Canada Business Corporations Act, according to a company news release.

The company said 92.7% of all voting creditors and 99.5% of the total amount voted by creditors voted to accept the plan.

"We are entering the final stretch of our recapitalization process," Mecachrome president and chief executive officer Julio De Sousa said in the release.

"Once the plan is implemented, the company will emerge financially stronger, poised to pursue growth opportunities."

According to the release, the plan remains subject to the adoption by the French court of a safeguard plan for the company's French subsidiaries.

As previously reported, under the plan, investors will contribute €62 million, including €22 million in exit financing, in exchange for a 100% equity interest in the reorganized company.

In addition, noteholders will receive €33 million in cash, representing a 16% recovery, and other Canadian creditors will also recover about 16% in cash.

Mecachrome is required to obtain at least €22 million in exit financing under the restructuring agreement.

Mecachrome is a Montreal-based designer, manufacturer and assembler of precision-engineered industrial components for the automotive and aerospace industries in Europe and North America.

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