Quebecor Receives Court Bankruptcy Protection
Quebecor World Inc. has been granted protection from its creditors under the Companies’ Creditors Arrangement Act. Several of Quebecor World’s U.S. subsidiaries are covered by the filing, which was heard and ruled on by the Quebec Superior Court.
Additionally, the company filed for Chapter 11 protection in the Southern Judicial District of New York.
Ernst & Young will serve as the court-appointed monitor, and will assist the company in its reorganization efforts.
The company has secured a $1 billion financing commitment from Credit Suisse and Morgan Stanley, which will allow it to meet its operating expenses. The bankruptcy proceedings became necessary when a proposed CDN$400 million rescue financing agreement with Quebecor Inc. and Tricap Partners Ltd. Fell through.
“Today’s filing is the result of industry pressures, particularly in Europe, combined with the inability of the company to raise new capital in the current market environment and the inability to complete the sale of its European operations.,” said Quebecor World president and CEO Jacques Mallette.
Mallette continued, “The steps we initiate today will allow the company to make changes which are necessary to ensure the long-term viability of the company within a process that ensures fair and equitable treatment for all stakeholders.”
Quebecor both provides printing services for, and has been an advertiser in, Direct magazine, Direct Newsline’s parent product.
