WILMINGTON, Del. – A Connecticut company would lend bankrupt Pulp and Paper of America $2 million to maintain its idle mills in northern New Hampshire under a plan supported by creditors and New Hampshire officials Monday.

The proposal by Fraser Papers Inc. of Stamford, Conn., was aired at a U.S. Bankruptcy Court hearing after creditors objected to a competing proposal from another paper company, Cascades Inc. of Kingsey Falls, Quebec.

Pulp and Paper of America owns the mills in Berlin and Gorham, N.H. It would use the loan to maintain the mills during the next two months while it tries to sell them.

Judge Irwin Katz was expected to sign an order approving the Fraser plan late Monday or Tuesday, said Peter Roth, an assistant New Hampshire attorney general.

Cascades had offered to maintain the plants through the winter, but creditors objected in papers filed Monday. They said the company’s plan would benefit mainly Cascades and would make it more difficult to find a buyer.

Cascades’ proposal would have limited purchase negotiations to Cascades, Fraser and Keating Fibre of Fort Washington, Pa. Fraser’s offer does not preclude any other company from bidding.

In Maine, Fraser plays a vital role in the town of Madawaska and surrounding area. Its mill employs 1,037 workers in the town of about 5,000.