Chemtura granted court approval to extend maturity of DIP financing

By Jennifer Lanning Drey

Portland, Ore., July 14 - Chemtura Corp. received court approval to extend its debtor-in-possession facility Tuesday from the U.S. Bankruptcy Court for the Southern District of New York, according to an attorney.

The DIP loan amendment provides two possible extension options, including an extension to June 22, 2010 from March 22, 2010 and an extension to Sept. 22, 2010 from June 22, 2010.

As previously reported, Chemtura will be required to provide 30-days to 60-days written notice of its intention to exercise either option and will be required to pay a 1% fee for each extension.

Also under the amendment, the company must file a reorganization plan that calls for payment in full of the DIP loan before securing the 15-month extension. To obtain the 18-month extension, Chemtura must have already obtained approval of its disclosure statement.

The DIP facility's availability must be at least $30 million at the time of either extension.

When requesting approval of the extension, Chemtura said it would give the company increased flexibility to manage its operations and significantly improve its ability to refine and implement its restructuring strategy.

Chemtura is a Middlebury, Conn.-based manufacturer and seller of specialty chemicals and polymer products. The company filed for bankruptcy on March 18. Its Chapter 11 case number is 09-11233.

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