LONDON (From news reports) -- Norkse Skog's protracted debt restructuring looks set to be extended even further with the paper producer saying the planned public launch of the revised proposals at Thursday's extraordinary general meeting would no longer take place after new directors joined the board yesterday.

Since the EGM was called on August 3 local Norwegian investors have built up equity stakes in the company. GSO and Cyrus, who had received their equity from a previous restructuring, have reduced their stakes in recent months, according to Thomson Reuters data.

Ole Anders Engebretsen and Bertel Steen declared stakes of 7.6% and 7% this month, for instance. And yesterday the board said it would recommend that Christen Sveaas, now the largest shareholder through his vehicle Kistefos, became the new chairman.

Sveaas will replace current chair Henrik Christensen. Nils Hoff, Joanne Owen and Mimi Berdal will also step down in favour of Ragnhild Marta Wiborg, Jon-Aksel Torgersen and Annette Beate Waknitz Malm Justad. Only Eilif Due would remain as a director under the plans.

The board changes and termination of the debt exchange are the latest instalments in the Norske Skog saga. The highly leveraged Norwegian company has been battling structural decline in the newsprint industry and various debt exchanges attempted since 2015 have failed to return it to financial health.

"The election committee has in addition considered the recent changes in the shareholder structure of the company, and on the views received from the company's largest shareholder groups," the company said yesterday.

However, the motivation of the new shareholder group is unclear. The current restructuring proposals, now shelved, anticipate that creditors will see some of their debts converted into equity, which would dilute existing shareholders.

Ahead of the EGM Norske Skog said this morning that the existing recapitalisation plans would be postponed "in order to provide the new board with an opportunity to review the recapitalisation transaction and allow for discussions with relevant stakeholders prior to a public launch."

However, the company said work would continue on finalising the creditors' proposed provision of €16m short term liquidity. This is backed by holders of the €290m 2019 senior secured bonds and a €100m Norwegian securitisation facility due 2020.

"The work with finalising the documentation for this liquidity facility is being progressed in an expedite manner," it said.

"Whilst both the company and these holders remain committed to further progress the transaction, we consider it natural that a new board is given an opportunity to review the recapitalisation transaction prior to a launch," said Lars Sperre, the company's CEO.

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