May 3, 2004
Asbestos Negotiations to Continue This Week
Negotiations aimed at finding agreement on legislation overhauling
the asbestos litigation system will continue this week, although
lawmakers said that talks last week yielded little progress,
face='Times New Roman'>CongressDaily reported. Democrats and
Republicans likely will agree to continue talks, but it is unclear
whether they will be monitored by retired federal judge Edward Becker,
who was
asked to lead talks by industry and other stakeholders, the newswire
reported.
Air
Plan to Find New Investor Approved
The court-appointed bankruptcy
monitor overseeing Air
Canada's restructuring recommended approval of the airline's plan to
seek out a new investor in the airline, after its deal with Hong Kong
billionaire Victor Li expired, the Associated Press reported. In a
report released on Saturday, accounting firm Ernst and Young said the
new plan will 'provide the certainty and speed to facilitate Air
exit from CCAA [bankruptcy] proceedings.' Under the new plan, proposed
equity investment agreements must be submitted by June 18 after which
the monitor will provide its recommendation to the company and the
court, AP reported.
Global Crossing Names Firm to Review Accounting
Global Crossing Ltd. today said it named Deloitte
& Touche
to review its accounting and said it faces a possible de-listing of its
shares from Nasdaq, Reuters reported. The developments come less than a
week after the telecommunication network company said it would restate
2003 earnings, review its 2002 results and delay reports for this year.
The Bermuda-based firm, which recently emerged from bankruptcy
protection, last week said it understated liabilities for access charges
in its 2003 financial statements by $50 million to $80 million, the
newswire reported.
Pepsi, Frito-Lay Get SEC Notification on Kmart
PepsiCo Inc.'s soft drinks and snacks divisions may
face civil action from
regulators over dealings with retailer Kmart Holdings Corp., the soft
drink company said on Friday, Reuters reported. Regulators are probing
documents signed by a Pepsi-Cola employee and another at Frito-Lay,
PepsiCo said. The documents are suspected of giving incorrect timing of
revenue that Kmart generated from those businesses, PepsiCo said in a
statement.
In a statement, Kmart said it learned of the
improperly recorded vendor allowance transactions during a review
completed in early 2003, before Kmart's May 2003 emergence from chapter
11 bankruptcy protection. Kmart said it cooperated with federal
regulators in that review, and fired all employees it deemed
responsible, the newswire reported.
RCN Bonds Rise on Bankruptcy
Hopes
RCN Corp. bonds increased last week on hopes that the
cable and telecom company will make good on its promise to file for
voluntary bankruptcy today, analysts and traders said, Reuters reported.
RCN said in February that it was working with banks and bond holders to
restructure and file for voluntary bankruptcy, but did not give a time
frame. Today, bond holders could declare Princeton, N.J.-based RCN in
default on $493 million in debt, after the company began missing
interest payments on a portion of that debt in January. The company, the
most recent victim of a sector downturn that is only just beginning to
reverse, has avoided bankruptcy since February only through the
agreements of its lenders not to declare default, the newswire
reported.
Stelco Unsure
Why
Government
Aid
Stelco Inc. is puzzled that a union representative
does not want the government to help its restructuring process, the CEO
of Canada's steelmaker said on Friday, Reuters reported. Courtney Pratt
said the survival of Stelco, which entered bankruptcy protection in
January will require contributions from every interested group.
The comments from Pratt came in reaction to a media report that quoted
Rolf Gerstenberger, president of United Steelworkers of America Local
1005, as saying government assistance was an 'easy way out,' the
newswire reported.
Delta Names New Chief Financial Officer
Delta Air Lines Inc. on Friday named a CFO to replace
Michele Burns, one of several senior executives to depart in the last
four months, Reuters reported. Michael Palumbo, a long-time airline
finance executive with experience at Trans World Airlines, Western
Airlines and Pan American World Airways, will replace Burns, who will
leave at the end of the month. Delta on Friday also announced the
retirement of its executive vice president of human resources, Robert
Colman, the newswire reported.
Texas Group Makes Unsolicited Bid for Fleming
Unit
A group of Texas-based executives on Friday said it
made an unsolicited $315 million cash bid for bankrupt Fleming Cos.
Inc.'s Core-Mark International distribution unit, Reuters reported. The
executive group, CVCMA LLC, said it sent a letter to Fleming seeking to
buy Core-Mark, Fleming's last remaining key asset. Fleming filed for
chapter 11 bankruptcy protection last year, the newswire
reported.
NEGT Accepts TransCanada Bid To Acquire Gas
Pipeline
Bethesda, Md.-based National Energy & Gas Transmission Inc. (NEGT)
late
Thursday accepted TransCanada Corp.'s bid to acquire Gas Transmission
Northwest Corp., an NEGT subsidiary, the company said. The purchase
price is $1.703 billion, including $500 million of assumed debt. The
period established by the bankruptcy court for the submission of
competing bids recently terminated. A hearing before the federal
bankruptcy court to approve the sale will be held May 12. Pending an
affirmative order by the court, NEGT anticipates the sale will be
completed this quarter or early next quarter, according to a company
press release.
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Reliance Group Creditors File Chapter 11 Turnaround Plan
The official unsecured bank panel in the Reliance Group Holdings Inc.
chapter 11 case has filed a plan of reorganization, according to a Form
8-K filing submitted Thursday with the Securities and Exchange
Commission. According to the filing, the bank panel filed the turnaround
plan on Tuesday with the U.S. Bankruptcy Court in
Group has been operating under chapter 11 protection since June
2001. Under the plan, administrative expense claims, such as those filed
by
lawyers and other professionals in the case, will be paid in full in
cash on the plan's effective date. Priority tax claims will also be paid
in full.
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Bankruptcy Judge Approves Order for
of Mills
After a day of negotiations among the various parties in Portland,
Maine, Judge James Haines approved a 26-page agreement spelling out the
terms of the nearly 24 million dollar purchase by First Paper Holding,
the Associated Press reported. The closing is expected to take place in
about two weeks, and the buyer said it hopes to restart one of the
tissue machines at the
thereafter.
Liberate Announces Reorganization Under
Chapter 11
Liberate Technologies announced
on Friday in a press release it had filed a voluntary petition for
reorganization under chapter 11 of the U.S. Bankruptcy Code to resolve
certain outstanding liabilities, reduce costs and strengthen its
financial position.
Liberate intends to file a plan of reorganization in
the U.S. Bankruptcy Court in
payment of 100 percent of valid creditor claims. Liberate hopes to
emerge from bankruptcy within a period of 4-6 months. During the
bankruptcy process, Liberate expects to operate its business in the
normal course, including continued compliance with active customer and
vendor contracts, and service and support of its cable customers and
their subscribers, according to the press release.
Trump Resorts May Skip Interest Payment
Donald Trump's casino company plans on skipping an
interest payment that's due today and hopes to file for a 'prepackaged'
bankruptcy restructuring by the end of May, according to three people
familiar with the deal, the New Jersey
Star-Ledger reported.
Although analysts and regulators say Trump Hotels and
Casino Resorts has the cash to make the $73.1 million payment, the
company has warned it may not make it the day it comes due, and instead
pay it within the 30-day grace period. The plan now, people familiar
with the deal said, is to file for a prearranged bankruptcy before the
grace period runs out and the company goes into default on its debt, the
newspaper reported.