Quebecor World files reorganization plan, to exit bankruptcy in July

By Caroline Salls

Pittsburgh, April 21 - Quebecor World Inc. filed its plan of reorganization and related disclosure statement with the U.S. Bankruptcy Court for the Southern District of New York, according to a company news release.

Quebecor said it plans to file a complementary plan of reorganization and compromise in its Companies' Creditors Arrangement Act in Canada during the first week of May.

The company added it expects to emerge from bankruptcy with a strong balance sheet by mid-July.

According to the disclosure statement, plan distributions will be funded by exit financing, cash on hand and the company's operations.

The plan does not call for any recovery for the holders of its existing multiple voting shares, redeemable first preferred shares and subordinate voting shares.

Treatment of creditors will include:

• Holders of Syndicate claims and SocGen claims will receive a share of a class 1 recovery, provided that any common stock and warrant bundles that the Syndicate creditors would receive from the class 1 recovery will be transferred to holders of class 4 claims under a settlement and the SocGen recovery will be withheld pending resolution of an adversary proceeding;

• Holders of secured claims will either have their claim reinstated or paid in full in cash or they will receive the collateral that secures the claim;

• Holders of general unsecured claims against the operating debtors will receive new unsecured notes equal to 50% of their claim, provided, however, that if the total claim amount exceeds $150 million, each claimant will receive a share of $75 million in new unsecured notes;

• Holders of senior notes claims and general unsecured claims against the non-operating debtors will receive a share of a class 4 securities distribution and a class 4 litigation trust recovery;

• Holders of convenience claims will be paid in full in cash;

• Intercompany claims will either be reinstated or cancelled with no distribution, at the company's option, provided that these creditors will receive a share of available new debt consistent with the debt to be received by holders of general unsecured claims against the operating debtors; and

• Debtor interests will be reinstated, except as otherwise provided under restructuring transactions.

A hearing on approval of the disclosure statement is scheduled for May 15.

Quebecor World, a Montreal-based printing and marketing company, filed for Chapter 11 bankruptcy on Jan. 21, 2008 and filed for protection under the Companies' Creditors Arrangement Act in Canada. Its Chapter 11 case number is 08-10152.

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