Sherwin Alumina granted interim access to $500,000 of DIP financing

By Caroline Salls

Pittsburgh, Jan. 13 – Sherwin Alumina Co., LLC obtained interim court approval to use $500,000 of a proposed $40 million of debtor-in-possession financing from primary pre-bankruptcy lender Commodity Funding, LLC, according to an order filed Wednesday with the U.S. Bankruptcy Court for the Southern District of Texas.

The final hearing is scheduled for Feb. 10.

The company said the financing will be used to support its continued operations, and the DIP financing, combined with cash generated from ongoing operations, will provide sufficient liquidity to support the business during the restructuring process.

Interest will be 8%.

The facility will mature on the earliest of May 11, the plan effective date, acceleration of the DIP obligations, acceptance of a bid for the company’s assets that is not approved by the lender unless the proceeds will be used to pay the DIP loan obligations in full in cash and the conversion or dismissal of the Chapter 11 cases.

Sherwin, a Gregory, Texas-based alumina producer, filed bankruptcy on Jan. 11. The Chapter 11 case number is 16-20012.

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