February 28, 2000
Slow Start to Second Session of 106th Congress
Members of Congress have been in Washington only 13 days in
January and February, including attendance at President Clinton's State
of the Union address, The Washington Post reported. And the
Senate is preparing for another recess at the end of this week; there
are only 100 legislative days remaining before targeted adjournment.
Some legislators are beginning to wonder whether Congress will get its
work done. Senate Minority Leader Tom Daschle (D-S.D.) said, 'This is as
slow as it gets, I think. It's like a snail riding on the back of a
turtle saying 'Whee!'' Republicans are more optimistic however, and
House Majority Leader Richard K. Armey (R-Texas) said last week that
'things are off to a good start' and that the Republicans will pursue a
strategy of 'three yards and a cloud of dust.' Although the Senate
approved bankruptcy reform legislation, little action has been taken
toward preparing the conference report with the House, which passed its
version of the reform bill last May.
Vencor Extends Maturity of $100 Million DIP Facility
Vencor Inc., Louisville, Ky., announced Friday that it has
agreed with its lenders to amend the company's $100 million
debtor-in-possession (DIP) financing to extend its maturity until June
30, according to a newswire report. The amendment also revises certain
financial covenants and enables the the company to seek an extension of
the time period in which to file its reorganization plan. The Bankruptcy
Court for the District of Delaware has scheduled a hearing on the
amendment for March 10. The DIP facility and existing cash flows will be
used to fund the company's operations during the restructuring; as of
Feb. 25, the company had no outstanding borrowings against the DIP
financing. Vencor, a national provider of long-term health care
services, and its subsidiaries sought chapter 11 protection last
September.
GBC Bancorp Announces Receipt of Problem Loan Payment
Los Angeles-based GBC Bancorp, the parent company of General
Bank, received $28 million Friday from the bankruptcy court-ordered sale
of the Sunrise Suites hotel, casino and RV park in Las Vegas, according
to a newswire report. The bank is owed additional amounts on its loan to
Sunrise Suites. The bank holds as collateral a senior-most real estate
encumbrance on about 18 acres of land in Las Vegas, which GBC expects
will be sold within the next several months.
Study Shows Farmers Who Change Business Thrive
Several new studies show that once farmers move past the trauma
of quitting the family farming business, they are glad that they did, or
at least find that life after farming is less stressful and more
financially secure, the Associated Press reported. According to a study
conducted by researchers at Iowa State University and the University of
North Carolina, farmers forced out of business in Iowa in the 1980s
wound up with higher incomes than their neighbors who stayed in
agriculture and showed less evidence of stress and depression. Farmers
who left farming in the mid- to late 1980s saw their incomes rise from
$5,670 to $9,820 per person from 1989 to 1992, according to the study.
At the same time, average per capital earnings for families still in
agriculture dropped from $10,870 to $7,950 per person. The study also
showed that symptoms of depression dropped sharply among men and women
who left farming. One third-generation farmer filed for bankruptcy two
years ago with $140,000 in debt and got out of the business. Today he is
relieved to be out of the business and now manages 55 oil wells in
Texas. A similar study at the University of Wisconsin showed few regrets
among dairy farmers who quit the business in the late 1980s and early
1990s. The Agricultural Department said that about 67,000 farmers leave
the business each year. While a lot of those are retirements, an
estimated 5 percent of farmers under age 35, the most financially
vulnerable period for a producer, quit each year.
Fewer Doctors Affected by Mergers & Acquisitions Last
Year
According to Irving Levin Associates, a health care research
and publishing firm, fewer U.S. physicians and medical practices were
affected by mergers and acquisitions in 1999 than in 1998, the lowest
number since 1995, according to a newswire report. A total of 134
mergers and acquisitions of physician medical groups were announced last
year. Irving Levin Associates' report, 'The Physician Medical Group
Acquisition Report,' Fifth Edition, showed that 202 practices and
organizations were merged or acquired last year, affecting 9,750
physicians. Compared to the 1998 market, this represents a 48 percent
decline in deals and 45 percent decrease in the number of organizations
targeted. Stephen Monroe, managing editor of Irving Levin, said, 'The
ranks of physician practice management groups (PMS) have been decimated,
some through bankruptcy and some through flight to more profitable lines
of businesses. Others were taken private to escape the vagaries of the
markets.' He said this is reflected in the the fact that for the first
time since 1994, privately held groups acquired 70 percent of physicians
in 1999, as compared with 30 percent in 1998.
Asia Pulp to Pay $135 Million in Settlement to Beloit
Asia Pulp and Paper Co. said Friday that it has agreed to
settle a dispute over the proposed purchase of two paper manufacturing
machines from Harnischfeger Industries Inc.'s subsidiary, Beloit Corp.,
according to a newswire report. Singapore-based Asia Pulp said that as
part of the settlement it will pay $135 million to Beloit. The agreement
is subject to the bankruptcy court's approval because Beloit and certain
subsidiaries are operating under chapter 11 protection.
Globalstar to Launch Satellites This Week
While Iridium LLC, the first mobile phone network using space
satellites, is still reorganizing in bankruptcy court, the second such
provider is confident its reception will be much better when it launches
its wireless service across North America this week. Globalstar USA
planned to announce today the introduction of full service throughout
the United States, Canada and Mexico for those who buy a special cell
phone that can connect with the 52 Globalstar satellites orbiting the
earth. The service launch follows two months of limited trials designed
to avoid the numerous technological, strategic and financial problems
that have plagued Iridium since it went live in late 1998. Iridium filed
for bankruptcy last year and may soon receive a cash infusion from
cellular pioneer Craig McCaw. A bankruptcy court hearing is scheduled
for later this week on the proposal.
Abacan Resource Corp. Will Proceed with Canadian Bankruptcy
Procedures
Abacan Resource Corp. announced an update of its affairs on
Friday and said that it has been unable to secure partners for either of
its Benin Republic or Nigerian oil and gas properties and that it has
been unable to raise additional operating funds, according to a newswire
report. Abacan also said that it has been advised that its major secured
creditor it not prepared to inject additional funds or participate in a
restructuring of the outstanding principal balance of its secure loans.
As a result, the board of directors anticipates that the company will
proceed with a voluntary assignment into bankruptcy pursuant to Canada's
Bankruptcy and Insolvency Act in the near future.
New Jersey Man Pleads Guilty to Bankruptcy Fraud
Robert Concannon, Parlin, N.J., pleaded guilty last week to a
bankruptcy fraud charge in a one-count information, according to the
U.S. Department of Justice. Concannon filed a petition June 5, 1997,
seeking to discharge about $130,000 in debts, but he did not disclose
that he maintained a bank account at the Amboy National Bank, leased a
1997 Mercedes Benz about May 23, 7 and that his wife owned a
half-interest in a construction company in the two years before the
bankruptcy case. Concannon will be sentenced on May 25; he faces a
maximum of five years in prison, a $250,000 fine and an order of
restitution. U.S. Trustee Patricia Staiano, Region 3,
worked with the FBI on the case.
ATC Group Seeks to Extend Exclusive Vote Period to May 12
ATC Group Services Inc. is seeking a 60-day extension of the exclusive
period during which it may solicit acceptances to its fourth amended
plan of reorganization. An extension of the exclusive solicitation
period to May 12 will enable ATC to secure firm exit financing
commitments, fulfill the necessary conditions to the exit financing and
complete the plan solicitation process without the threat of a competing
plan of reorganization, the consulting firm asserted in a motion, filed
Tuesday.
Courtesy of
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February 28, 2000.
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