Quebecor World gets interim OK to use up to $750 million of DIP facility

By Rebecca Melvin

New York, Jan. 24 - Quebecor World (USA) Inc. received interim approval to use up to $750 million of its $1 billion debtor-in-possession financing from Credit Suisse and Morgan Stanley, according to an order filed Thursday with the U.S. Bankruptcy Court for the Southern District of New York.

A final hearing will be held March 6.

The interim financing will be used to finance continuing operations and additional working capital.

Of the three-quarters of the DIP facility that the company is allowed now to access, $416.8 million will be applied toward the purchase of a receivables portfolio.

The DIP facility is subject to approval by both the U.S. and Canadian courts. It will include a $400 million revolving credit facility, with a C$150 million sublimit for Canadian dollar loans and including a $100 million letter-of-credit subfacility and a $50 million swing line subfacility, and a $600 million term loan.

Interest on the revolver will be Libor plus 225 basis points or Base rate plus 125 bps, at Quebecor World's option; interest on the Canadian dollar loans will be either the average discount rate for bankers' acceptances of the appropriate amount and the appropriate term as quoted on the Reuters Screen CDOR Page plus 225 bps or the Canadian Prime rate plus 125 bps; interest on swing line loans will be Base rate plus 125 bps; and interest on the term loan will be Libor plus 375 bps or Base rate plus 275 bps, at Quebecor World's option.

The DIP facility will mature on the earliest of 18 months from the bankruptcy filing date, 45 days after entry of the interim order if a final order has not been entered, upon the effective date of a plan of reorganization and upon acceleration of the loans.

The Montreal-based printing and marketing company filed for Chapter 11 bankruptcy on Jan. 21 in the U.S. Bankruptcy Court for the Southern District of New York and filed for protection under the Companies' Creditors Arrangement Act in Canada. Its Chapter 11 case number is 08-10152.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.