Mallinckrodt takes next step to implement financial restructuring plan

Mallinckrodt announced that it has taken the next step to implement the comprehensive financial restructuring plan contemplated by a restructuring support agreement, the company previously entered into with more than 85% of each of the company’s first and second lien debtholders and the Opioid Master Disbursement Trust II as announced on August 23. Pursuant to the RSA and with the authorization of the company’s board of directors, Mallinckrodt and certain of its subsidiaries initiated voluntary prepackaged Chapter 11 proceedings in the U.S. Bankruptcy Court for the District of Delaware. With the overwhelming support of its key stakeholders, the company expects to complete the court-supervised process in the fourth quarter. Implementing the financial restructuring contemplated by the RSA will reduce the company’s total funded debt by approximately $1.9B, increase free cash flow generation, extend maturity runway and better position the business for long-term success. The RSA also provides for, among other consideration, a final, one-time payment of $250M that was made to the Trust on August 24. This payment, in addition to the $450M the company previously paid, is intended to support the trust’s mission to address the U.S. opioid crisis and fund addiction treatment.