August 92004

Submitted by webadmin on Mon, 2004-08-09 00:00

August 9, 2004

Adelphia Holds Talks Involving
Possible Bidders

Adelphia Communications Corp. said on Friday it has
held preliminary talks with potential bidders and hopes to complete the
discussions by year end, the Associated Press reported. Executives then
will decide whether it would be best to sell all or part of the assets
or emerge from bankruptcy-court protection as a stand-alone company.
Bids will be solicited for the entire company and for specific assets,
with the goal of finding out by October who may be interested, the
newswire reported.

Goldman Cuts Delta to
'Underperform'

Research firm Goldman Sachs cut
its rating on Delta Air Lines Inc. to 'underperform' from 'in line' on
Friday, saying that the company's losses are mounting as yields remain
under pressure, fuel prices soar and negotiations with pilots 'appear to
stall,' Reuters reported. 'Absent labor concessions, we are revising our
full-year 2004 loss to $13.65 from $10.90 (per share), and we believe
the probability of a Delta bankruptcy filing is rising,' wrote analyst
Glenn Engel in a note to clients. Shares of Delta tumbled 7.6 percent,
or 34 cents, to $4.16, the newswire reported.

MCI Shares Soar 16 Percent
on Dividend Plan

MCI Inc. shares increased 16
percent on Friday, a day after the long-distance company announced a
quarterly dividend of 40 cents per share that may be tax-free for many
shareholders, Reuters reported. MCI said on Thursday it would begin
paying the dividend in September as part of a plan to return $2.2
billion to shareholders. The MCI board was required to return 'excess'
cash to shareholders under the company's bankruptcy
reorganization.

British Individual
Insolvencies Hit Record in Q2

The number of people in England
and Wales becoming insolvent hit record levels in the second quarter,
suggesting rising interest rates may be hitting heavily indebted
households, Reuters reported.The number of individual insolvencies rose
to 11,214, up 7.9 percent from the first quarter and 28.7 percent from a
year earlier, seasonally adjusted Department of Trade and Industry data
showed on Friday. Economists said Britain's huge debt level -- consumer
borrowing reached a trillion pounds ($1,822 billion) in June -- is
making the economy more vulnerable to shocks, particularly as interest
rate hikes hit already overstretched household budgets, the newswire
reported.

size='3'>California Court
Dismisses Class Action Against Solutia Executives

A shareholder class-action suit
filed earlier this year in
California against
certain current and former executives at Solutia Inc. was dismissed July
28, the company said in a quarterly report. The suit was brought
by people who bought Solutia stock at what they claim were inflated
prices, due to the result of its Flexsys joint venture with Akzo Nobel
NV being incorporated in Solutia's financial results. The suits allege
Flexsys's bottom line was 'inflated as a result of anticompetitive
collusion between Flexsys and other rubber chemical producers during the
period December 1998 through October 2002,' the Thursday 10Q filing by
Solutia said. Solutia, which is in chapter 11 bankruptcy
protection, previously has said antitrust authorities in the
United
States, Europe
and
Canada
are investigating commercial practices in the rubber chemicals industry,
including those of Flexsys.

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NorthWestern Chapter 11 Plan
Has OK from Most Creditor Classes

Energy company NorthWestern
Corp. received approval of its reorganization plan from a majority of
voting creditors, according to preliminary results from the
balloting. Roger Schrum, a spokesman for NorthWestern, told
DBR Friday that its chapter 11 plan was approved by three classes of
voting creditors and rejected by one class. The company's senior
unsecured debt holders, creditors with general unsecured claims and
those with director and officer trust claims all voted to approve the
plan, Schrum said.

Judge Skeptical of Clifford
Deal With Brobeck

Clifford Chance isn't off the
hook yet in litigation arising from the collapse of Brobeck, Phleger
& Harrison, the Recorder reported. Although U.S. Bankruptcy
Judge Dennis Montali on Friday put off considering a settlement proposed
by Brobeck's bankruptcy trustee, he said he was inclined not to approve
it as currently drafted. The hearing focused instead on the trustee's
request to disqualify Pachulski, Stang, Ziehl, Young, Jones &
Weintraub from representing a group of former Brobeck partners. Read the
full article at
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Terra to
Buy MississippiChemical
for $107 Million

Terra Industries Inc. today
said it has agreed to buy bankrupt Mississippi Chemical Corp.
for $107 million in stock in a deal that would expand Terra's
fertilizer-making capabilities, Reuters reported. Under the terms of the
deal, Sioux City, Iowa-based Terra said it will also assume $161 million
of debt. Terra expects the acquisition of Mississippi Chemical to add to
earnings and cash flow in the first year after closing, which is
expected no later than the first quarter of 2005. The deal is subject to
approval by the U.S. Bankruptcy Court for the Southern District of
Mississippi, the newswire reported.

size='3'>Air CanadaLoss
Shrinks Despite Deep Charges

size='3'>Air Canada
said on Friday it had pared its losses in the second-quarter, readying
the carrier for a flight out of bankruptcy protection by the end of
September, Reuters reported. Air
Canada
said it lost C$510 million ($390 million), or C$4.24 a share, in the
quarter, compared with a year-earlier loss of C$566 million or C$4.70 a
share. But the airline said the latest quarter included restructuring
charges of C$426 million, nearly twice as much as the C$217 million in
charges incurred in the same period last year, the newswire
reported.

TMM Pulls Off Debt Swap,
Avoids Bankruptcy

size='3'>Mexico's
largest shipping and railroad firm, TMM, said on Friday nearly all
creditors holding $377 million of debt agreed to exchange the notes for
new bonds, helping the company to avoid bankruptcy, Reuters reported.
The swap also enables TMM to sort out a dispute
with U.S.
partner Kansas City Southern Industries Inc. Kansas City Southern and
TMM operate the main rail line in
Mexico
via their venture, TFM. Struggling with large debts, TMM agreed in April
2003 to sell its 41 percent of TFM to Kansas
City Southern for $412 million, but then called
off the deal last August. Kansas
City Southern, which already has 39 percent of
TFM with the Mexican government owning the rest, opposed the pullout.
Both sides eventually agreed to arbitration to resolve their
differences.