Catalyst Paper, which owns the Crofton pulp mill, is now considering its options if the deal to sell the company to the Indian-based Kejriwal Group International falls through.

The four principal stakeholders in Catalyst, who own 79 per cent of the B.C.-based company, announced on Oct. 26 that they are considering an alternative recapitalization proposal if the proposed deal with the Kejriwal Group, announced in June, is not completed.

The stakeholders — Mudrick Capital Management LP, Cyrus Capital Partners LP, Oaktree Capital Management LP, and Stonehill Management LLC — are looking at significant debt reductions through deferrals and conversion of its loans that would provide the forest company with enhanced liquidity.

A press release from Catalyst said the implementation of the alternative recapitalization plan would not affect any of Catalyst’s contractual relationships with its trade vendors or any amounts owing to them.

“We are pleased that each of our principal stakeholders are willing to support an alternative recapitalization plan that would significantly reduce debt and provide enhanced liquidity without affecting trade vendors,” said Joe Nameth, president and CEO of Catalyst.

The deadline for the acquisition agreement between Catalyst and the Kejriwal Group expired on Oct. 25 with no deal in sight.

As a result, either party to the agreement is now permitted to terminate it, although they have not taken such action to date.

“There can be no assurance that the support agreement will not be terminated and the transaction will be completed,” the press release stated.

“Catalyst and its board of directors are reviewing and evaluating the alternative recapitalization plan with the assistance of legal and financial advisors and will be providing an update to such review in due course.”