Smurfit-Stone Container Canada Implements Restructuring Plan

On June 30, 2010, the Joint Plan of Reorganization for Smurfit-Stone Container Corporation and its Debtor Subsidiaries and Plan of Compromise and Arrangement for Smurfit-Stone Container Canada Inc. and Affiliated Canadian Debtors – which had been separately confirmed by both the Ontario Superior Court of Justice and the US Bankruptcy Court – was implemented by both the Canadian and the US Debtors. The implementation of the Joint Plan involved, amongst other things, the sale of substantially all of the assets of the principal Canadian Debtors to a new Canadian partnership, Smurfit-Stone Container Canada L.P., in exchange for amounts sufficient to repay secured debt and to fund two distribution pools for unsecured creditors, which pools remain to be distributed.

By way of background, Smurfit-Stone Container Canada Inc. and other Canadian affiliates of US-based Smurfit-Stone Container Corporation obtained protection from their creditors pursuant to the Companies' Creditors Arrangement Act (CCAA) on January 26, 2009. The CCAA filing was part of a consolidated filing by the parent corporation under Chapter 11 of the U.S. Bankruptcy Code, which took place in the United States Bankruptcy Court in Wilmington, Delaware. The consolidated group had secured debts of approximately US$1 billion and unsecured bonds of approximately US$2.8 billion.

Smurfit-Stone was represented in-house by Craig Hunt, Senior Vice-President, General Counsel and Secretary, and Dean Jones, Senior Counsel, International Affairs and Assistant Secretary, and in the US by James Conlan, Dennis Twomey and Matthew Clemente of Sidley Austin LLP. Smurfit-Stone was also represented in the CCAA proceedings by a team from Stikeman Elliott LLP in Toronto that included Sean Dunphy and Alexander Rose (litigation/insolvency); Marvin Yontef and Elizabeth Breen (corporate/finance); Gary Nachshen (pensions); Ronald Durand (tax) and Brenda Hebert (real estate), as well as Kevin Kyte and Pierre Setlakwe in the Montréal office.

Exit financing was provided by a syndicate arranged by Deutsche Bank Securities Inc., J.P. Morgan Securities Inc., GE Capital Markets, Inc., Banc of America Securities, LLC and Wells Fargo Capital Finance, LLC. The exit finance syndicate was represented in Canada by Blake, Cassels & Graydon LLP, with a team that included Ian Binnie and Marc-Antoine La Rochelle (financial services) and Susan Grundy and Linc Rogers (insolvency) and in the US by White & Case LLP.

Deloitte & Touche Inc., the Monitor, was represented by Goodmans LLP with a team that included Robert Chadwick and Chris Armstrong (corporate/restructuring); Fred Myers (litigation) and Jay Feldman (finance).