Northern Pulp approved for $15M in financing from third-party lenders
By P&PC Staff
By P&PC Staff
Northern Pulp has received creditor protection until the end of 2020 and was approved for $15 million in financing from third-party lenders – but it will not be able to use the money to pay retirees and laid-off workers.
CBC News reports that a Supreme Court judge in British Columbia, where Northern Pulp’s owner Paper Excellence is located, made the decision on Aug. 6.
The Nova Scotia–based mill originally had sought $50 million in financing, but was met with objections by government representatives who said Northern Pulp owes the province $85 million. The reps said any additional financing might compromise the government’s ability to recoup the money.
The proposed financing agreement was revised to an installment of $15 million to help the mill see through the end of the year as it proceeds with the cleanup of Boat Harbour and works through the feasibility of the province’s environmental requirements for the Northern Pulp’s proposed treatment plant.
Laid off and retired mill workers are owed nearly $2 million by Northern Pulp, but with the province of Nova Scotia opposing non-secured creditors being paid, the judge did not approve the claim.
The mill was approved to continue delivering salary to the few remaining workers who are performing shutdown processes and maintaining the mill grounds.
Ernst & Young has been ordered by the court to deliver an update on Northern Pulp’s status by October.
Read the full story here.