A Connecticut company would lend bankrupt Pulp and Paper of America $2 million to maintain its idle mills in northern New Hampshire under a plan supported by creditors and New Hampshire officials.
The proposal by Fraser Papers Inc. of Stamford, Conn., was aired at a U.S. Bankruptcy Court hearing after creditors objected to a competing proposal from Cascades Inc. of Kingsey Falls, Quebec.
Pulp and Paper of America owns the mills in Berlin and Gorham, N.H. It would use the loan to maintain the mills during the next two months while it tries to sell them.
The loan would be secured by liens on a landfill and hydroelectric plants that Pulp and Paper owns.
Cascades offered to maintain the plants through the winter, but creditors objected. They said the company's plan would benefit mainly Cascades and would make it more difficult to find a buyer.
Cascades' proposal would have limited purchase negotiations to Cascades, Fraser and Keating Fibre of Fort Washington, Pa. Fraser's offer does not preclude any other company from bidding.
Roth said he expected Katz to approve the plan, but other parties could object.
The mills closed in August. In September, Pulp and Paper and its parent company, American Tissue Inc., Hauppauge, N.Y., filed for bankruptcy protection. Associated Press
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