Masonite runs out of time, defaults on debt-sources
NEW YORK, Nov 17 (Reuters) - Masonite International, a Canadian door maker struggling to avoid bankruptcy, is expected to be deemed in default on its debt after running out of time to make an overdue interest payment, according to sources familiar with the situation.
Masonite, which is owned by private equity firm Kohlberg Kravis Roberts & Co, failed to make an interest payment on its $770 million in bonds on Oct. 15, and had until Sunday, Nov. 15 to make up for the failure.
The company also breached terms in its loan agreements.
Sources said the payment on its bonds was not made by the Nov. 15 deadline, which will constitute a default and mean that payments on credit default swaps insuring the debt will need to be made.
A spokesman for Masonite was not immediately available for comment.
Credit default swaps on Masonite's loans are included in the benchmark loan derivative index.
KKR took Masonite private in a leveraged buyout in 2005. (Reporting by Karen Brettell; editing by Gary Crosse)
