Shearman & Sterling represented the lead investors, Avenue Capital Group and DDJ Capital Management, in connection with the acquisition of substantially all of the assets of Milacron Inc.
Milacron is a leading global supplier of plastics-processing technologies and industrial fluids, with major manufacturing facilities in North America, Europe and Asia. The transaction included an out-of-court restructuring of Milacron’s Ferromatik business in Germany and the acquisition of assets in both Canada and the US, including subsidiaries around the world.
The acquisition was consummated pursuant to section 363 of the US Bankruptcy Code and Canada’s Company Creditors’ Arrangement Act. Avenue Capital and DDJ controlled approximately 80% in principal amount of Milacron’s prepetition secured notes. In order to bridge to an orderly 363 sale, Avenue Capital and DDJ backstopped a new $80 million secured priming debtor-in-possession (DIP) delayed draw term loan, which involved $40 million of new capital, and a $40 million rollover of prepetition notes. In addition, GE Capital Corporation provided a new revolving DIP facility.
The purchase price for Milacron’s assets included the conversion of the $80 million DIP term loan, repayment of the GECC DIP revolver and a credit bid of a portion of the investor’s prepetition secured notes.
In order to consummate the transaction, the acquisition vehicle entered into a new $55 million revolving credit facility with Wells Fargo and Bank of America, and the investors entered into a new $75 million second lien note agreement.
The Shearman & Sterling team included partners Michael Baker (New York-Finance), Lisa Brill (New York-Property), John Cannon III (New York-Executive Compensation & Employee Benefits), Esther Jansen (Frankfurt-Finance), Don Lonczak (Washington-Tax), Scott Petepiece (New York-Mergers & Acquisitions), William Roll III (New York-Litigation), and James Scott Sr. (New York-Capital Markets); counsel Mehran Massih (London-Capital Markets) and Jason Pratt (New York-Property/Environmental); and associates Timothy Andison (New York-Finance), Gaurav Chaudhari (New York-Finance), Margaret Davidson (New York-Mergers & Acquisitions), Irina Dragulev (New York-Litigation), Richard Fischetti (New York-Bankruptcy & Reorganization), Timothy Franklin (New York-Mergers & Acquisitions), Timothy Hanson (New York-Mergers & Acquisitions), Karen Holdridge (New York-Property), Seth Kerschner (New York-Property/Environmental), Carl McCarthy (New York-Bankruptcy & Reorganization), Solomon Noh (New York-Bankruptcy & Reorganization), Alexander Schiel (Frankfurt-Mergers & Acquisitions), Curtis Scribner (New York-Bankruptcy & Reorganization), Rachel Silber (New York-Finance), Jeffrey Tate (Washington-Tax), Olena Tokman (Frankfurt-Mergers & Acquisitions), Stephen Vander Stoep (New York-Mergers & Acquisitions), Veronica Wissel (New York-Executive Compensation & Employee Benefits), Carmen Wong (New York-Capital Markets), and Gregory Wyckoff (New York-Litigation).