By: E&P Staff
AbitibiBowater is looking for a Canadian court’s help in a $620 million claim resulting from the 2001 sale of notes by Bowater Canada Finance Corp., Bloomberg Businessweek reported Sept. 3.
The company’s Bowater unit guaranteed the $600 million in 7.95% notes, two holders of which, Aurelius Capital Management LP and Contrarian Capital Management LLC, argue that Bowater is liable for contribution under a provision of the Nova Scotia Companies Act. The bankruptcy court called for appointment of independent advisers for Bowater Finance, which filed a $620 million claim against the Bowater unit.
In filings this week in bankruptcy court in Wilmington, Del., AbitibiBowater said it will object to the claim. The claim being controlled by provincial law, the companies want permission to seek the opinion of the Canadian judge on the dispute – a request made under a cross-border protocol established at the outset of the bankruptcies.
AbitibiBowater seeks an accelerated hearing on the matter because its Chapter 11 plan is scheduled for approval at a Sept. 24 confirmation hearing. The noteholders and their indenture trustee, however, object to an accelerated hearing.
AbitibiBowatere filed for Chapter 11 protection in April 2009, with its combined companies showed assets of $9.9 billion and debt of $8.8 billion as of September 2008.