American Roads, which operates the mile-long Detroit Windsor Tunnel linking the U.S. to Canada, has won court approval of a turnaround plan to shed $830 million in debt from swaps and bonds issued after a private-equity buyout, Bloomberg News reported yesterday. U.S. Bankruptcy Judge Burton R. Lifland confirmed the plan in Manhattan. The deal transfers ownership of American Roads from Greenwich, Conn.-based investment company Alinda Capital Partners, which holds stakes in London's Heathrow Airport and other infrastructure projects, to financial insurer Syncora Guarantee in exchange for a $334 million swap liability. Under the plan, holders of $496 million in bonds due in 2026 will receive nothing, although their rights to insurance claims will remain intact. Judge Lifland had ruled Aug. 28 that an ad-hoc group of the bondholders didn't have legal standing in the case and couldn't object to the reorganization. The ruling was issued about a month after Detroit-based American Roads sought court protection from creditors, blaming the city's falling population, reduced traffic, natural disasters, increased federal regulations and lower-than-forecast revenue from four toll roads in Alabama.
