The group lodged its plans last weekend, but US Trustee Andrew Vara had initially objected to the 19 day timescale because the court requires all creditors to be given not less than 28 days’ notice.
However, at the Delaware Court, bankruptcy judge John Dorsey approved the plans on the basis that OSG had given adequate notice to key stakeholders, including its major creditors, prior to the filing.
He said that OSG had provided sufficient evidence to demonstrate the deadlines were necessary, and the code does allow this in certain circumstances.
"I think here the cause has been made clear on the record that if the process is not completed by August 31st, there could be financial harm to the constituencies here, which would not be beneficial to anyone," the judge stated.
OSG also gained interim approval for $26m in debtor-in-possession (DIP) financing, included an immediate loan of $7.5m.
OSG owns Leeds-headquartered Communisis.
Communisis is not one of the OSG entities named in the Chapter 11 filing, but its pension scheme forms part of the group’s liabilities and trustees and The Pensions Regulator will need to approve the plans.
OSG entered into a Deed of Guarantee on 17 September 2019 with The Pensions Regulator.
This provides an unsecured guarantee for the obligations under the UK DB Plan (defined benefit).
“As of the Petition Date, no claims have been made on the Pension Guarantee as the sponsoring employers to the UK DB Plan have made all required contributions to the UK DB Plan,” OSG stated in its initial Chapter 11 filing.
A spokesperson for The Pensions Regulator told Printweek: “We are aware of the situation but do not comment on specific schemes.”
According to the Communisis results for calendar year 2020, its defined benefit pension scheme had assets of more than £185m, and a deficit of nearly £36m.
Communisis stated that it was business as usual for the company, and nothing would change in respect of the day-to-day business of Communisis “either for our clients, vendors, employees or any other stakeholders”.
OSG Group currently has $824m of debt which would be reduced to $690m, including a debt for equity swap under the restructuring proposals.
If all goes to plan OSG will emerge from Chapter 11 before the end of this month.
