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Major unsecured creditor rejects Norske Skog recapitalisation proposal

16 Oct 2017 − 

Deadline for consent by bondholders is Thursday 19 October

Restructuring Capital Associates L.P. and its affiliate Bennett Management Corporation (Bennett) announced that it rejects the most recent Norske Skog recapitalisation proposal.  James Bennett, the founder of Bennett, said: "Funds managed by Bennett have held unsecured bonds of Norske Skog for several years and currently own over 50% of the 2026 issue and over 40% of the 2033 issue, which together represent over €100m of claims of the Senior Unsecured Notes issued by Norske Skogindustrier ASA . While we support a restructuring that converts all of our debt to equity, we are not prepared to accept a 98% write-off, while the purportedly "secured" debt receives €421.7m for their €390m face amount of debt (108% recovery)”.

The company said it was are prepared to accept the over-recovery by the SSN/NSFs and the other terms of the recapitalization, even though they are unfair, if the combined recovery by the SUNs and the Exchange Notes issued by Norske Holding AS is increased by €1.5 million of additional equity value (0.7% of pro forma recapitalisation shares). Norske Skog's board apparently decided to reject our request and to proceed instead with a proposal they know cannot succeed, because it is conditioned on our consent, Bennett said.

Find the entire article and any associated background information in EUWID Pulp and Paper no. 42.

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