Zlomrex International U.K. restructuring case recognized by U.S. court

By Caroline Salls

Pittsburgh, Jan. 31 - Zlomrex International Finance SA was granted U.S. recognition of its voluntary restructuring proceeding before the Chancery Division (Companies Court) of the High Court of Justice of England and Wales, according to a Friday filing with the U.S. Bankruptcy Court for the Southern District of New York.

According to the recognition motion, neither Zlomrex nor its group as a whole were expected to be able to repay the outstanding debt under the company's 8½% senior secured notes when they matured on Feb. 1, and Zlomrex's directors believed a refinancing would be difficult to achieve.

As a result, the company said a scheme of arrangement is the best possible outcome for Zlomrex and its creditors "because it avoids a value destructive liquidation of ZIF and other group companies."

The company said the notes will either be restructured through an exchange solicitation or the scheme, with creditors receiving the same share of exchangeable notes and senior secured notes under both possibilities.

Friday's order enforces the automatic stay imposed by the company's Chapter 15 bankruptcy filing and protects Zlomrex from creditor actions.

Zlomrex, a London-based financing vehicle, filed bankruptcy on Dec. 23. The Chapter 15 case number is 13-14138.

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