NewPage Fending Off Takeover?
Paper maker buys itself some time as owner of rival Verso puts on the squeeze.
NewPage has filed an amendment to its $500 million revolving credit facility with the SEC to extend the maturity date by at least five months to March 2012.
According to NewPage's third quarter earnings report, the revolving credit facility matures on October 2, 2012 unless it repays or refinances second-line notes by July 4, 2011.
Apollo Management, which has ownership stake in Verso, took over many of those notes, giving it significant leverage over NewPage and putting itself into position to force NewPage into insolvency six months from now by insisting on a full repayment, according to Dead Tree.
But while 11 different financial institutions, including Well Fargo, approved of the changes to the revolving credit facility, the documents references to "non-accepting" lenders suggest some banks rejected the deal and will no longer be working with NewPage, says Dead Tree.