RICHMOND, BC, Jan. 31, 2012 /CNW/ - Catalyst Paper Corporation (TSX:CTL)
announced today that the company and certain of its subsidiaries have
obtained an Initial Order from the Supreme Court of British Columbia
under the Companies' Creditors Arrangement Act (CCAA). The terms and conditions of the restructuring plan have not
yet been determined by the company.
The company also announced that JP Morgan has agreed to provide
debtor-in possession (DIP) financing to Catalyst, which is expected to
provide the company with up to approximately $175 million of available
capital during the CCAA proceedings. Advances under the DIP will be
available after approval by the Court, which the company expects to
obtain on February 3, 2012. The Initial Order provides the company
with access to an amount the company believes is sufficient to fund
operations until the Court hearing on February 3, 2012. The company's
operating revenue combined with the proposed DIP financing are expected
to provide sufficient liquidity to meet ongoing obligations to
employees and suppliers and ensure that normal operations continue
during the restructuring process. Catalyst management will remain
responsible for the day-to-day operations of the company.
The company intends to apply for recognition of the Interim Order under
chapter 15 of title 11 of the US Code.
The Court granted protection under the CCAA for an initial period
expiring on February 14, 2012 to be extended as required and approved
by the Court. While the company and its subsidiaries are under CCAA
protection, all proceedings on the part of their creditors are stayed.
The CCAA filing applies to Catalyst, Catalyst Paper General
Partnership, Catalyst Pulp Operations Limited, Catalyst Pulp Sales
Inc., Pacifica Poplars Ltd., Catalyst Pulp and Paper Sales Inc., Elk
Falls Pulp and Paper Limited, Catalyst Paper Energy Holdings Inc.,
0606890 B.C. Ltd., Catalyst Paper Recycling Inc., Catalyst Paper
(Snowflake) Inc., Catalyst Paper Holdings Inc., Pacifica Papers U.S.
Inc., Pacifica Poplars Inc., Pacifica Papers Sales Inc., Catalyst Paper
(USA) Inc. and The Apache Railway Company.
Catalyst manufactures diverse specialty printing papers, newsprint and
pulp. Its customers include retailers, publishers and commercial
printers in North America, Latin America, the Pacific Rim and Europe.
With four mills located in British Columbia and Arizona, Catalyst has a
combined annual production capacity of 1.9 million tonnes. The company
is headquartered in Richmond, British Columbia, Canada and its common
shares trade on the Toronto Stock Exchange under the symbol CTL.
Catalyst is listed on the Jantzi Social Index® and is also ranked by
Corporate Knights as one of the 50 Best Corporate Citizens in Canada.
Certain matters set forth in this news release, including statements
with respect to the CCAA proceedings, the operations of the company,
liquidity and the ability of the company to meet its obligations are
forward looking. These forward-looking statements reflect management's
current views and are based on certain assumptions including
assumptions as to future operating conditions and courses of action,
economic conditions and other factors management believes are
appropriate. Such forward looking statements are subject to risks and
uncertainties that may cause actual results to differ materially from
those contained in these statements, including those risks and
uncertainties identified under the heading "Risks and Uncertainties" in
Catalyst's management's discussion and analysis contained in Catalyst's
annual report for the year ended December 31, 2010, and our third
quarter interim report available at www.sedar.com.
SOURCE Catalyst Paper Corporation
For further information:
| Investors: || Media: |
| || |
| Brian Baarda || Lyn Brown |
| Vice-President, Finance & CFO || Vice-President, Marketing & Corporate Responsibility |
| 604-247-4710 || 604-247-4713 |
| || |
| Alistair MacCallum || |
| Vice-President, Treasurer & Corporate Controller || |
| 604-247-4037 |