This represents a $250 million increase and a one-year extension over Solutia's current DIP financing. The increased availability under the DIP financing provides Solutia with further liquidity for operations and the ability to fund mandatory pension payments that come due in 2007. The agreement also allows for Solutia to purchase Akzo Nobel's stake in Flexsys, the 50%/50% joint venture between Azko Nobel and Solutia. (In a separate press release, Solutia announced it has reached an agreement in principle to purchase Akzo Nobel's 50 percent stake in Flexsys.) To facilitate the Flexsys acquisition, up to $150 million of additional funds could be raised under this DIP financing through an accordion feature, bringing the total to $1.225 billion. The DIP financing can be repaid by Solutia at any time without prepayment penalties. Citigroup is acting as lead arranger.
This amendment requires the approval of the United States Bankruptcy Court for the Southern District of New York.
Solutia Receives Fully Underwritten Commitment To Extend And Increase Debtor-In-Possession Financing
Solutia Inc. (OTCBB:SOLUQ), manufacturer and provider of interlayers for laminated glass, aftermarket window films, specialty chemicals and an integrated family of nylon products, announced it has received a fully underwritten commitment for $1.075 billion of debtor-in-possession (DIP) financing, maturing March 31, 2008.