Source Interlink shareholders ask for official committee to be named

By Jennifer Lanning Drey

Portland, Ore., May 12 - An ad hoc committee of Source Interlink Cos., Inc. equity shareholders asked U.S. Trustee Roberta DeAngelis for official committee representation, in a letter filed Tuesday with the U.S. Bankruptcy Court for the District of Delaware.

The group said an official equity committee was needed because neither it nor any single equity shareholder had the financial wherewithal to mount a meaningful challenge to the company's pre-packaged plan of reorganization filed April 27.

The ad hoc committee said equity shareholders should have been approached about contributing new value to the company to address its debt in exchange for the opportunity to increase or preserve their ownership.

"At the very least, the shareholders should have been consulted about the deal given to the institutional lenders," they said.

An official equity committee would ensure that the value of Source Interlink's estate is maximized and that every effort is made to have a fair and equitable plan, the ad hoc committee said.

As previously reported, Source Interlink's pre-packaged plan of reorganization calls for the company's lenders to cancel nearly $1 billion of existing debt and provide $100 million in additional liquidity.

Holders of equity interests would not receive any distribution under the plan. Source Interlink would emerge from bankruptcy as a private company.

Source Interlink, a media and marketing services company based in Bonita Springs, Fla., filed for bankruptcy on April 27. Its Chapter 11 case number is 09-11424.

© 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.