SP Newsprint granted court OK for up to $25 million DIP facility

By Caroline Salls

Pittsburgh, Jan. 25 - SP Newsprint Holdings LLC received court approval of its up to $25 million debtor-in-possession facility, according to a Wednesday filing with the U.S. Bankruptcy Court for the District of Delaware.

General Electric Capital Corp. is the agent.

Specifically, the company can borrow up to $20 million under the facility, plus up to $5 million in increases, according to the filing.

SP Newsprint said the DIP loan will give it working capital to operate in Chapter 11 and preserve the value of its business while it conducts a going-concern sale process.

The facility will mature on the earliest of 180 days after closing, the effective date of any plan of reorganization for the company and closing of an asset sale.

Interest will be Base rate plus 650 basis points for Base rate loans and Eurodollar plus 750 bps for Eurodollar loans, according to court documents.

SP Newsprint, a Greenwich, Conn.-based newsprint producer, filed for bankruptcy on Nov. 15. Its Chapter 11 case number is 11-13649.

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