NewPage Enters Chapter 11 Restructuring Process
MIAMISBURG,OH—Sept. 7, 2011—NewPage Corp. announced that, to facilitate an orderly debt restructuring and position the overall business for long-term success, its corporate parent, NewPage Group and certain of its U.S. subsidiaries have commenced voluntary cases under Chapter 11 of the U.S. Bankruptcy Code (“Chapter 11”). The cases are pending in the U.S. Bankruptcy Court for the District of Delaware. The company’s Consolidated Water Power Company subsidiary is not part of the filing.
Separately, the company’s Canadian subsidiary, NewPage Port Hawkesbury Corp., has brought proceedings before the Supreme Court of Nova Scotia under the Companies’ Creditors Arrangement Act of Canada (“CCAA”). In order to maximize efficiency in both the U.S. and Canadian Court processes, NewPage Corporation and NewPage Port Hawkesbury Corp. have executed a Settlement and Transition Agreement, subject to approval by the Canadian Court.
Chapter 11 Restructuring for U.S. Entities
Through the Chapter 11 process, NewPage expects to work closely with its creditors and other stakeholders in the U.S. to formulate a Chapter 11 plan that details how it intends to satisfy its liabilities and restructure its balance sheet to emerge as a financially stronger company. The company expects to continue operating its U.S. businesses as usual throughout this process with an undiminished focus on providing customers with high-quality paper and employees with a stable and safe working environment.
To help ensure it has adequate liquidity to achieve these objectives and continue to operate and compete successfully throughout the restructuring, NewPage has obtained a commitment led by J.P. Morgan for up to $600 million in Debtor in Possession (DIP) financing.
Additionally, NewPage has filed a series of customary First Day Motions in the U.S. Bankruptcy Court that, subject to court approval, would allow it to continue its U.S. employee wages and benefits programs, honor obligations for customers served by its U.S. businesses and provide additional protection to various other stakeholders. These motions are typical of the Chapter 11 process and are generally granted in the days immediately after a filing.