Almatis gets OK to enter into plan agreement with Dubai International

By Lisa Kerner

Charlotte, N.C., Aug. 3 - Almatis BV was granted approval to enter into a plan of reorganization support agreement with its largest equity holder Dubai International Capital LLC and Almatis' supporting pre-bankruptcy junior lenders, according to a Tuesday filing with the U.S. Bankruptcy Court for the Southern District of New York.

The court also approved a number of requested financing commitments and allowed Almatis to enter into currency rate hedging contracts to minimize the impact of currency rate fluctuations on the proposed transactions.

As previously reported, Almatis elected to opt out of its pre-packaged plan support agreement and move forward with the Dubai proposal.

The Dubai proposal calls for a refinancing of the company's senior debt under which senior debtholders could be paid in full and junior debtholders could receive a greater distribution than under Almatis' pre-packaged plan.

Almatis said in a news release that it will withdraw its current pending prepackaged plan by the end of the week and file a new plan with disclosure statement, also later this week.

Almatis added that the new plan has the support of its largest shareholder, Dubai International Capital, and the necessary holders of its second lien, mezzanine and junior mezzanine debt.

Under a settlement also announced Tuesday, Oaktree Capital Management, the largest single holder of the group's senior debt has agreed to support the new plan. The settlement with Oaktree is subject to approval by the Bankruptcy Court.

The new plan will result in the the full repayment of Almatis' senior first lien debt, and also proposes "significantly enhanced" distributions to the junior creditors.

Funding will come from a $100 million equity contribution that Dubai International Capital has already escrowed with JP Morgan and from approximately $600 million of debt financing to be provided by a consortium of JP Morgan, Bank of America Merrill, GSO Capital Partners, GoldenTree Asset Management and Sankaty Credit Opportunities IV.

A hearing on the disclosure statement for the new plan and the settlement with Oaktree is scheduled for Aug. 23.

Almatis anticipates confirmation in late September.

Almatis is a Frankfurt, Germany, developer, manufacturer and supplier of premium specialty alumina products that filed for bankruptcy on April 30. Its Chapter 11 case number is 10-12308.

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