NewPage Port Hawkesbury gets timeline extension to sell mill
November 29th, 2011 | Posted in Mill Sales/Transfers | 1 comment »
This morning the Nova Scotia Supreme Court has approved an extension to NewPage Port Hawkesbury‘s creditor protection period.
Now the company has until January 20, 2012 to sell the Cape Breton paper operation. By December 16, the field of 4 bidders will be narrowed to 1.
NewPage Port Hawkesbury said it has sufficient cash reserves to maintain the operations at the mill in a “hot idle” state until January 20, 2012. However, that estimation is based on the assumption the company will collect $3.3 million in HST receivables during the week ending on December 24, 2011. Without that amount of money, there will not be sufficient cash to maintain the hot idle state past Christmas.
The Province of Nova Scotia has indicated it will “look favourably on a request from the Company to provide debtor in possession financing, if required, to ensure operations can be continued while a going concern sale is completed.”
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While NPPH gets prepared to go seeking a taxpayer handout to enable them to maintain hot-idel status until the sale is completed, $300,000 from the $25 million STA agreement is earmarked as bonuses for the senior troughers in Port Hawkesbury. If Darrel Dexter is smart, before he hands over 1 cent of tax-payer money, he’ll make damn sure that the $300,000 in trough money is spent on operating costs first.
Meanwhile, back at the NewPage trough in the US, senior troughers there have filed a motion that would allow $3 million to be divided among 15 troughers as part of a short-term incentive plan. Next up will be a motion for trough money for their long term incentive plan. It certainly makes me wonder how inept and incompetent people can continously return to the trough looking for more money. They were handsomely rewarded from the trough during the last 5 years while they lead the company to the brink of bankruptcy and extinction.