Chemtura files motion to seek OK for new $450 million DIP facility

By Jennifer Chiou

New York, Feb. 4 - Chemtura Corp. announced that it filed a motion with the U.S. Bankruptcy Court for the Southern District of New York seeking approval of its amended and restated $450 million debtor-in-possession financing credit facility.

Citibank, NA is the lead bank along with Bank of America NA, Barclays Bank plc and Wells Fargo Foothill LLC.

The new DIP facility, which refinances Chemtura's existing $400 million DIP facility, provides it with improved financing and credit terms and additional financial flexibility, according to a news release.

It also permits capital expenditures necessary to execute its business plan, the release added.

On Jan. 25, the company lowered pricing on the facility to Libor plus 400 basis points from Libor plus 425 bps, according to a market source.

"The lenders have shown confidence in the company's strong performance and management by increasing the DIP facility by $50 million and, at the same time, by significantly lowering the financing costs," Craig A. Rogerson, Chemtura's chairman, president and chief executive officer, said in the release.

"The improved terms of the new DIP facility are a reflection of the improving credit markets as well as a testament to the outstanding progress we are making in our restructuring efforts."

As already reported, tranching on the deal is comprised of a $150 million revolver and a $300 million term loan. The original issue discount on the term loan was reduced to 99½ from 99, the source previously said.

As before, both tranches carry a 2% Libor floor.

Chemtura is a Middlebury, Conn.-based manufacturer and seller of specialty chemicals and polymer products.

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