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ORIX Will Help Newark Group

ORIX Finance Group, Dallas, is leading a group of five lenders and has arranged a $110 million credit facility to support The Newark Group through its bankruptcy process, reports Citybizlist. With the solid support of all relevant stakeholders, the recycled boxboard producer filed for Chapter 11 bankruptcy protection on June 9 and now expects to exit bankruptcy in August with financing in place.

Although the company¹s business was operationally sound, its need to restructure debt followed a severe industry-wide decline in sales due to the general slowdown of the U.S. economy. Prior to filing, The Newark Group reached an agreement for a consensual restructuring with the holders of its senior subordinated notes.

ORIX has arranged for a $110 million debtor-in-possession (DIP) and exit term loan facility. The DIP term loan repaid The Newark Group¹s pre-petition term loan and provided additional cash to increase its liquidity. The exit term loan will provide term financing to support the company's operations as it comes out of reorganization.

When The Newark Group needed help, our team was able to build consensus among a group of diverse creditors and assemble a financing package to help the company restructure its balance sheet, says Chris Smith, senior managing director of ORIX Finance. ³The financing also provides capital to continue to grow the business and support all of its stakeholders, including customers, vendors, and more than 2,500 employees.

Founded in 1912, Cranford, N.J.- headquartered The Newark Group is a vertically integrated, global producer of 100 percent recycled boxboard. It also makes core board, folding carton board, and industrial converting grades of paperboard.