Anchor Glass to restructure; 1st mortgage notes to remain outstanding, unsecured notes to be paid at par

New York, March 15 - Anchor Glass Container Corp. said it reached an agreement on a financial restructuring which includes an investment of $100 million of new capital from Cerberus Capital Management LP, including $80 million of equity, and a "significant" restructuring of the company's debt and equity securities through a prepackaged Chapter 11 filing.

Under the proposed reorganization, Anchor's existing senior bank facility will be replaced by a new $100 million credit facility.

The Tampa, Fla. company's first mortgage notes will remain outstanding and investors will receive a payment to compensate them for their waiver of change of control provisions. The interest payment due April 1 will not be made although holders will receive all accrued interest on confirmation of the reorganization plan, Anchor said.

Anchor's unsecured notes will be repaid in cash at 100% of their principal amount. However the company will not make the interest payment due March 15.

Holders of Anchor's series A preferred stock, which has a current accrued liquidation value of $82 million, will receive $22.5 million in cash while holders of the series B preferreds with an accrued liquidation value of $106 million will receive $3.0 million in cash.

Other creditors will be unimpaired.

Anchor's existing common stock will be canceled and holders will receive nothing.

Anchor said it expects to make a prepackaged Chapter 11 filing within the next two weeks.

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