Pope & Talbot wood pulp asset buyer asks court to enforce sale order

By Caroline Salls

Pittsburgh, July 7 - Pope & Talbot, Inc. wood pulp business asset buyer International Forest Products Ltd. asked the U.S. Bankruptcy Court for the District of Delaware to order Pope & Talbot to comply with the terms of the sale agreement, according to a Thursday court filing.

Specifically, Interfor said Pope & Talbot has failed to deliver credits and to make post-closing payments to third parties in accordance with the purchase agreement.

Interfor said there is $11.86 million owed under the purchase agreement in connection with post-closing price adjustments and other estate obligations, while there is $13.49 million being held in escrow to address the post-closing issues.

As a result, Interfor said Pope & Talbot's estates will still reap a net benefit of at least $1.63 million after it addresses the post-closing issues, as well as the possibility of realizing additional value from lands from which Interfor is helping the company remove use restrictions.

According to the motion, Interfor is obligated to help Pope & Talbot's trustee secure licenses and permits that will allow the trustee to release $6 million being held in escrow and sell parcels of land for significantly higher than the current permitted uses allow.

However, Interfor said it does not intend to perform its future purchase agreement obligations until Pope & Talbot makes the outstanding payments.

A hearing is scheduled for Aug. 7.

Pope & Talbot, a Portland, Ore.-based pulp and wood products company, filed for bankruptcy on Nov. 19, 2007. Its Chapter 11 case number is 07-11738.

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