Wellman negotiates DIP amendment to allow reorganization plan

New York, June 18 - Wellman, Inc. said it completed an amendment to its DIP facility that will allow it to carry out a stand-alone plan of reorganization.

The company also said it has reached agreement with the two largest holders of its second-lien debt to backstop an $80 million rights offering. This commitment is expected to be finalized before June 25.

Wellman also said it has made "significant progress on the other elements of the plan of reorganization."

Under the amended DIP facility, Wellman must file a plan of reorganization, a disclosure statement and a commitment of at least $70 million to backstop a rights offering with the bankruptcy court by June 25.

By July 14, the company is required to obtain an indicative commitment for exit financing with a fully underwritten commitment to follow by July 30.

Bankruptcy court approval of the disclosure statement must be obtained by Aug. 4 and confirmation by Sept. 15.

The exit would occur by Sept. 25.

Wellman, a Fort Mill, S.C., polyester products manufacturer, filed for bankruptcy on Feb. 22 in the U.S. Bankruptcy Court for the Southern District of New York. Its Chapter 11 case number is 08-10595.

© 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.