Solutia Completes Repricing of Debtor-In-Possessio
St. Louis, MO, June 2--Solutia Inc. today announced it has reached agreement with its lenders to amend its debtor-in-possession (DIP) financing, pending approval by the U.S. Bankruptcy Court.
This amendment reduces Solutia's term loan borrowing rate by approximately 250 basis points and lowers its interest costs by up to $7 million, depending on the length of Solutia's Chapter 11 case. In addition, the amendment provides for a six-month extension through June 19, 2006, and makes other minor modifications. The amount of the financing remains $525 million, and Citigroup Global Markets Inc. acted as lead arranger.
"Our ability to improve pricing of the DIP facility is a testament to the growing confidence in Solutia's reorganization progress and our significantly improved business performance," said James M. Sullivan, senior vice president and CFO, Solutia Inc. "In addition, while we may not ultimately need the extension, it gives us greater flexibility should we require more time to achieve the optimal resolution to our Chapter 11 case."
Solutia intends to promptly seek approval of this matter in the U.S. Bankruptcy Court for the Southern District of New York.
