by Karina Hunter
Terrace Bay Pulp received good news this week in regards to continued efforts to get the mill out of bankruptcy protection and re-open.
At a closed door meeting held at the Valhalla Inn in Thunder Bay , 168 creditors cast ballots during an important vote on the company’s restructuring plan and 165 of these were in favour of accepting it.
Buchanan Group Lawyer Yves Fricot commented to the press afterwards that it was a relief to get the vote behind them “The vote is a sign of overwhelming support for the mill and the idea that a strong forest industry can exist in this part of the region” said Fricot adding that the key selling point was the important role that TBP plays in the region”.
There are currently 35 million dollars in claims against the company and creditors representing 33 million of the claims voted to support the plan.
What happens now? In 2 weeks time TBP aims for a sanctioning meeting with a judge who will also go over the plan. Once sanctioned by the judge TBP can exit the CCAA, and following the filling of related paperwork they will be in a position to begin sending re-call notices to employees.
TBP plans to use a 25 million loan from province and 40 million dollar investment from outside lender to get the mill operating again.
This good news has come along with good timing, just as the pulp market is seeing some of its highest price levels in recent years. Without the success of today’s vote the company would’ve ended up in bankruptcy.
Terrace Bay Mayor Michael King sounded hopeful in regards to what the vote meant to his community, “This was a really important hurdle and now that they’ve completed that and had such overwhelming acceptance it will expedite the process of TBP exiting the CCAA” said King, he was cautious however, explaining that TBP was still to appear before the judge for review of the restructuring plan and once sanctioned, there would then be a number of days when other finalizations take place, before Terrace Bay Pulp could commence giving any notices to employees.
King explained though some of those laid off have found work locally at projects like the Terrace Bay Cultural Centre Project and other environmentally friendly initiatives ongoing in the community, a large number left the to find work elsewhere while keeping their homes in Terrace Bay. “For most, their families remain in Terrace Bay and this is where they call home” said King expressing hopes that those who chose to keep employment found since the mill’s closure would continue to call the lake shore town “Home Base”.
- What is the CCAA? The Companies’ Creditors Arrangement Act (commonly referred to as the “CCAA” or the “CC, double A”) is a Federal Act that allows financially troubled corporations the opportunity to restructure their affairs. By allowing the company to restructure its financial affairs, through a formal Plan of Arrangement, the CCAA presents an opportunity for the company to avoid bankruptcy and allows the creditors to receive some form of payment for amounts owing to them by the company.