UPDATED: Catalyst gets fresh vote to forestall selloff

The principal change to the plan is the compromise of certain extended health benefits plans for former salaried employees

Crofton paper mill’s owners have court approval to hold another vote in a bid to avert the company’s looming selloff.

Catalyst Paper has been granted a June 25 stakeholder vote about its amended plan of arrangement under the Companies’ Creditors Arrangement Act.

Court approval will allow a meeting of floundering Catalyst’s secured and unsecured creditors in Richmond’s Delta Vancouver Airport Hotel to consider the amended plan.

As described in Catalyst’s June 11 press release, the principal change to the plan is the compromise of certain extended health benefits plans for former salaried employees that were not to be compromised under the prior plan.

Other changes to the plan are necessary to reflect the new timing for creditor approval of the amended plan, the firm said.

Also as described June 11 was Catalyst’s proposed modifications to its salaried pension plan to provide a special portability-election option and solvency funding relief, which need provincial government approval.

Catalyst — employing 700-some Crofton workers — estimates it would save about $7 million annually if these modifications were made, following a successful plan of arrangement.

“We have received consent from a requisite number of our secured noteholders to move forward to a vote on the amended plan,” said CEO Kevin Clarke.

“This reflects the dedication of all parties to work toward a consensual deal that incorporates the many interests involved and that puts our company on better financial footing for the future.”

Catalyst Paper’s Board of Directors is unanimously recommending that all holders of First Lien Notes, Unsecured Notes and General Unsecured Claims vote in favour of the Amended Plan at the Meetings.