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June 27, 2006
id='1'>Nearly 50,000 Take Buyout Offer at GM and
w:st='on'>
size='3'>Delphi
In an employee exodus
that is one of the biggest ever, about 47,600 union workers at General
Motors and its former division, the Delphi Corporation, accepted early
retirement or buyout offers, the companies said Monday, according to
a New York
Times report today. At GM, about 35,000
workers will leave at the end of the year, the company said. The number,
representing nearly a third of GM's 113,000 hourly workers, is
significantly higher than the company had expected. As a result GM,
which intends to close 12 plants by 2008 to pare costs and become more
competitive, will reach its goal of eliminating 30,000 jobs two years
ahead of schedule, Chief Executive Rick Wagoner said. At
size='3'>Delphi
parts supplier, more than half of its 24,000 workers, or 12,600,
accepted similar early retirement packages. The number was also greater
than expected and should help
face='Times New Roman' size='3'>Delphi
size='3'>emerge from bankruptcy protection as a more efficient
company.
href='http://www.nytimes.com/2006/06/27/automobiles/27auto.html?_r=1&oref=slo…'>Read
more .
id='2'>Commentary: Pension Crash Landing
As Delta Airlines
announced last week that it will terminate its pilot pension plan,
becoming the latest airline company to flip liabilities to the federal
Pension Benefit Guaranty Corporation (PBGC), most taxpayers would think
that this would upset Congress, or at least inspire some reforms,
according to an editorial today in the Wall Street
Journal. However, House and Senate conferees
are busy negotiating another pension fix that would give airlines one
more reprieve and make taxpayers even more vulnerable to airline
mismanagement down the road. The PBGC has gone from a $10 billion
surplus in 2000 to more than a $23 billion deficit last year, and it is
the financier of last resort for a private defined-benefit pension
system that is underfunded to the tune of $450 billion. On present
trends, this could become a crisis on the order of the savings and loan
collapse.
href='http://online.wsj.com/article/SB115137329550591464.html?mod=opinion_mai…'>Read
more . (Registration required.)
id='4'>Refco’s Creditors Battle over Firm
Retention
The fight for the
remainder of Refco Inc.’s assets has begun, with two creditor
groups facing off in an attempt to recover funds lost in the futures
broker’s multi-million dollar meltdown,
face='Times New Roman' size='3'>Portfolio Media
size='3'>reported yesterday. Creditors of Refco’s offshore unit,
Refco Capital Markets Ltd., are looking to recoup nearly $2 billion in
funds transferred to other Refco entities just before Refco’s
bankruptcy filing. But creditors of the other Refco units are worried
that RCM’s creditors will leave them with nothing. This has drawn
protest from the other creditors, including Bear Stearns & Co. and
Deutsche Bank Securities, who worry that the trustee responsible for RCM
is intentionally creating conflicts of interest to prevent the opposing
creditors from hiring the same firms. The bankruptcy case is
In re Refco Inc. et
al., case no. 05-60006, in the U.S. Bankruptcy
Court in the Southern District of New York.
id='5'>Northwest Reaches Deal to Extend Use of Planes
A week after bidding to
buy more time to file its reorganization plan, Northwest Airlines Corp.
has persuaded certain creditors to allow the carrier to continue using
13 jet aircraft slated to be removed from service as the carrier
attempts to bring its fleet in line with current market values,
Portfolio Media
reported yesterday. Certain creditors hold liens on the
planes, which are operated by Northwest’s regional feeder Mesaba
Aviation Inc. on behalf of Northwest. The deal, reached late last week,
will enable Northwest to keep using the planes for a fee of $70,000 per
month per aircraft before they are eventually removed from service as
part of Northwest’s fleet rationalization. Northwest said the
market value of many of its aircraft have “declined substantially
since the aircraft were originally leased or financed” and that
costs for the aircraft are currently above market.
face='Times New Roman' size='3'>A hearing on the issue is scheduled for
July 6.
w:st='on'>
id='6'>London
size='3'> Fog Asks for Extension to Submit Reorganization
Plan
Busy seeking a buyer for
its raincoat trademark, London Fog Group Inc. has requested a
three-month extension to submit its reorganization plan,
face='Times New Roman' size='3'>Portfolio Media
size='3'>reported yesterday. London Fog, which filed for bankruptcy in
March, said Friday that the company needs to hold on to its exclusive
right to file a chapter 11 plan until Oct. 18 and through Dec. 18 to
lobby for creditor support for the plan. London Fog’s exclusive
period is currently scheduled to end July 18, and its right to win over
creditors is set to end by Sept. 18. The company asked for more time to
continue working on promoting some of its assets. A hearing on London
Fog’s extension request is scheduled for July 19 in the U.S.
Bankruptcy Court in
w:st='on'>
size='3'>Reno
w:st='on'>
size='3'>Nev.
id='7'>Bankrupt Hedge Fund Manager Pays Out More
Money
PlusFunds Group Inc., the
hedge fund manager that went bankrupt in the wake of Refco Inc.’s
collapse, has paid $300,000 to a private equity firm that demanded
reimbursement for legal costs following a failed bid to acquire its
assets, Portfolio
Media reported yesterday. In documents filed
last week with the U.S. Bankruptcy Court in
w:st='on'>
size='3'>Manhattan
size='3'>,PlusFunds
disputed the claims of the private equity firm, FTVentures, but settled
the suit anyway as part of an agreement in which the two sides said they
would not make further claims against one another. In April, San
Francisco-based FTV won a bankruptcy auction for PlusFunds’
assets. The bankruptcy court approved the $5 million sale, but FTV
withdrew the offer two weeks later, saying PlusFunds had failed to meet
certain closing conditions.
SGI
Broadens Product Line in Attempt to Emerge from
Bankruptcy
Silicon Graphics Inc.
said that it's broadening its product line to provide lower-cost
options, including the introduction of an x86-based server, in its
effort to return to profitability after its bankruptcy filing in
May,
size='3'>Computerworld reported
yesterday.
size='3'>Regarding the move into x86-based systems, Jill Matzke, SGI's
high-performance computing marketing manager, said, 'Obviously, one of
the things we need to [do] is expand our market reach.' She added that
the new products 'are very much part of our path back to
profitability.' After posting successive
quarterly losses, SGI earlier this year cut 12 percent of its workforce,
or about 250 employees. It then filed for chapter 11 bankruptcy
protection and quickly received court approval for a reorganization and
$70 million in financing.
href='http://www.computerworld.com/action/article.do?command=viewArticleBasic…'>Read
more .
id='9'>Minnesota Steakhouse Company Files for
Bankruptcy
Bloomington, Minn.-based
Timber Lodge Steakhouse Inc. on Monday filed for chapter 11 bankruptcy,
citing underperforming restaurants outside of
w:st='on'>
size='3'>Minnesota
residual debt from its 2004 ownership change, the
face='Times New Roman' size='3'>St. Paul Pioneer Press
size='3'>reported today. In its filing, Timber Lodge listed assets of
about $9 million and liabilities of $9.5 million. Once a chain of about
25 casual dining restaurants, the company now owns 15 locations,
including 13 in
face='Times New Roman'
size='3'>Minnesota
size='3'>.
href='http://www.twincities.com/mld/twincities/14908547.htm'>Read
more .
w:st='on'>
id='10'>California
face='Times New Roman' size='3'> Fitness Chain Files for
Bankruptcy
Bodies in Motion Inc., a
North Hills, Calif.-based fitness chain, has closed its location at
the
size='3'>Irvine
face='Times New Roman' size='3'>Spectrum
size='3'>Center
chapter 11 bankruptcy protection, the
w:st='on'>
size='3'>Orange
w:st='on'>
size='3'>County
face='Times New Roman' size='3'>Register
reported today. The company, whose other gym locations are in
Angeles
face='Times New Roman' size='3'>County
size='3'>, made the filing last week at the
w:st='on'>
size='3'>U.S.
size='3'>Bankruptcy Court in Woodland Hills. According to its bankruptcy
filing, Bodies in Motion tried unsuccessfully to find a buyer for the
business.
href='http://www.ocregister.com/ocregister/money/yourcounty/article_1194009.p…'>Read
more .
href='http://www.ocregister.com/ocregister/money/yourcounty/article_1194009.p…'>