Home / Knowledge / News / Textiles / Court approves Amended Disclosure Statment of Wellman

Court approves Amended Disclosure Statment of Wellman

15
Nov '08
Wellman, Inc. announced that the Bankruptcy Court has approved its Amended Disclosure Statement and authorized the Company to begin soliciting votes on its plan of reorganization (the "Plan").

The Plan contemplates the following:
The debt of the first and second lien holders will be converted into equity of the reorganized company "Reorganized Wellman". The first lien holders will receive 70%, and the second lien holders will receive 30% of the common stock of Reorganized Wellman on the Plan's effective date, subject to dilution by the conversion of the newly issued convertible notes.

The Company will receive $90 million in cash in exchange for $120 million of convertible notes issued through a rights offering, which will be offered to the first and second lien holders. These notes can be converted into 60% of the common stock of Reorganized Wellman. The $90 million will be used to repay amounts borrowed under its Debtor in Possession Credit Agreement (the "DIP Facility") and pay certain deferred financing fees, administrative expenses, priority claims, cure payments and professional fees.

The first lien holders will receive the proceeds from the sale of the property, plant, and equipment associated with the Company's Palmetto facility. The second lien holders will receive approximately 80% of the proceeds, if any, of a litigation trust and the general unsecured creditors will receive the remainder.

The Plan provides that the Company will emerge from Bankruptcy provided the following three events occur:

The Company receives $90 million in cash proceeds from the rights offering; The first and second lien holder classes both vote to accept the plan of reorganization; and Payments required for certain administrative expenses, priority claims and cure claims do not exceed $28 million.

If any of the three events listed above does not occur, the Company will immediately begin the process of liquidating its remaining assets in cooperation with its DIP Lenders. It is likely that the operations of the Company's Pearl River facility located in Hancock County, MS would be shut down as part of this process.

The Company has obtained an amendment of its DIP Facility, which provides that the Company must achieve the following milestones in order to remain in compliance with the DIP Facility:

Receive an acceptable backstop commitment for the rights offering on or before November 25, 2008; Obtain an order confirming the Plan by December 16, 2008; and Emerge from bankruptcy prior to December 31, 2008. Mark Ruday, Wellman's Chief Executive Officer, stated "We have worked very hard in extremely difficult economic times to preserve value for all of our stakeholders.

Based on our current situation, we believe the Plan provides the best opportunity for our creditors to maximize their recoveries in these Chapter 11 cases. We look forward to working with our customers, vendors, employees and other stakeholders to emerge from bankruptcy as a stronger, more profitable and highly competitive company."

Wellman, Inc. manufactures and markets high-quality PermaClear brand PET (polyethylene terephthalate) packaging resin and polyester chips, engineering resins, fiber and filament and high quality fibers from recycled polyester.

Wellman


Must ReadView All

Pic: Shutterstock

Retail | On 20th Oct 2021

Sept US retail sales up as goods spending preferred over services: NRF

US retail sales rose again in September as worries about the COVID-19 ...

Pic: DOST-PTRI Research and Development

Textiles | On 20th Oct 2021

Philippines scientists develop greener tech to produce bamboo fibres

Scientists in Philippines have developed greener technologies to...

Pic: Shutterstock

Textiles | On 19th Oct 2021

11 European nations seek ambitious measures to tackle waste in textile

Eleven European countries—Austria, Belgium, Denmark, Finland, France, ...

Interviews View All

Textile Industry, Head honchos

Textile Industry
Head honchos

Next level is to inject new features:

Vandana Narang, National Institute of Fashion Technology

Vandana Narang
National Institute of Fashion Technology

Campus placements are low due to lockdowns

Gaurav Davda, Jindal Worldwide Ltd

Gaurav Davda
Jindal Worldwide Ltd

Indian MMF sector to become globally competitive

David Guiho,

David Guiho

Headquartered in Apt, South of France, Delta Plus designs, manufactures...

Ritu Oberoi,

Ritu Oberoi

Established in 2018, Forsarees is a socially driven business enterprise,...

Raiyan Islam,

Raiyan Islam

Founded in 1981 by Sayeeful Islam, Concorde Garments Group is a market...

Keith McMillen, Bebop Sensors

Keith McMillen
Bebop Sensors

Bebop Sensors' smart fabrics allows for a new level of interaction between ...

Giulio Cesareo, Directa Plus

Giulio Cesareo
Directa Plus

UK-based Directa Plus is one of the largest producers and suppliers...

Frank Heislitz, Freudenberg

Frank Heislitz
Freudenberg

Freudenberg Performance Materials is a leading global manufacturer of...

Anjali Bhaskar, Samatvam

Anjali Bhaskar
Samatvam

Samatvam, a womenswear brand that blends age-old craftsmanship with modern ...

Sarah Denise Cordery, Sarah Denise Studio

Sarah Denise Cordery
Sarah Denise Studio

Manchester, England-based Sarah Denise Studio provides relevant fashion...

Vidur Adlakha & Riccardo Bennidini, La Fuori

Vidur Adlakha & Riccardo Bennidini
La Fuori

With an active presence in US, Italy and India, clothing brand La Fuori...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


October 2021

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Advanced Search