Mallinckrodt To Initiate Chapter 11 Bankruptcy Proceedings

(RTTNews) - Specialty pharmaceutical company Mallinckrodt plc (MNK) announced Wednesday that it intends to initiate voluntary Chapter 11 proceedings in the U.S. Bankruptcy Court for the District of Delaware. The Chapter 11 process is expected to be completed in the fourth quarter.

The company said it completed a restructuring support agreement or RSA with its first and second lien debtholders and the Opioid Master Disbursement Trust II.

The restructuring support agreement shall provide a final payment of $250 million to the Trust to support the mission to address the U.S. opioid crisis and fund addiction treatment. This payment is in addition to the $450 million previously paid.

Mallinckrodt expects that the comprehensive financial restructuring plan will reduce its total funded debt by approximately $1.9 billion, increase free cash flow generation, extend maturity runway, and better position the business for long-term success.