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May 19, 2005
Asbestos Markup Lags Because of Judicial Filibusters
Asbestos legislation negotiations could be delayed because of the
fight between Democrats and Republicans over judges,
CongressDaily reported. Senate Minority Leader Harry Reid
(D–Nev.) announced yesterday that Democrats will invoke the
“two-hour rule” to halt committee work once the full Senate
has been in session for two hours, a move that could cut short an
asbestos markup scheduled for today. While lobbyists were skeptical that
much work could be done on the bill within the allotted two hours (there
are dozens of amendments pending) lawmakers planned to press ahead.
Judiciary Chairman Arlen Specter (R–Pa.) “plans to move
ahead with the markup as scheduled,” a committee spokesman said.
He had planned to complete work on the bill before Congress breaks for
the Memorial Day recess. But that timetable could be hampered by the
two-hour constraint for committee work. Specter has warned that if the
committee does not act swiftly on asbestos, the opportunity for a floor
vote could pass.
Stelco Workers Band Together Against Steelmaker's Restructuring
Plan
Stelco Inc.’s union and salaried employees have banded together
in opposition to a restructuring plan by the Hamilton steelmaker, which
they say rewards major creditors but puts future pensions at risk, CP
reported. The union was joined by representatives from former and active
salaried employees in demanding that rival bids be considered in the
restructuring of Stelco, which has operated under bankruptcy protection
for more than 15 months. Stelco released its restructuring plan on a
confidential basis to stakeholders last week.
Delta Shares Rise More Than 12 Percent after Analyst Upgrade
Shares of Delta Air Lines Inc. yesterday rose more than 12 percent
after an analyst at JP Morgan raised his rating on the stock, saying the
market’s concerns about the carrier’s bankruptcy filing are
a bit premature, Reuters reported. Delta shares, which have fallen 50
percent since December, were up 27 cents, or 8.9 percent, at $3.28 in
early trading, after JP Morgan’s Jamie Baker raised his rating on
the stock to “overweight” from “neutral.”
“Shares imply bankruptcy this year. We disagree,” Baker
wrote in a research note. “Delta’s 2006 chapter 11
probability remains high, though in 2005 (it) remains comfortably below
the 75 percent implied by the equity market,” he said, the
newswire reported.
Perelman Wins $1.4 Billion Total in Suit Against Morgan Stanley
Morgan Stanley must pay billionaire financier Ron Perelman more than
$1.4 billion in damages, awarded by a jury that said it found clear
evidence the investment firm acted fraudulently in Perelman’s 1998
sale of his Coleman camping gear company to Sunbeam Corp., the
Associated Press reported. The jury deliberated for nearly four hours
yesterday before deciding on $850 million in punitive damages. On
Monday, the same jury awarded Perelman compensatory damages of $604.3
million.
US Air–America West Talks Intensify
US Airways Group Inc. and America West Holdings Corp. worked
yesterday to finalize a merger agreement that could be announced as
early as today, after receiving a crucial $250 million loan from
aircraft maker Airbus and nearing equity and financing agreements with
other key players, people familiar with the matter said, the Wall
Street Journal reported. But even if a deal is completed,
industry observers warn that the new carrier still faces significant
obstacles from labor unions, tough industry conditions and competition
from budget carriers such as Southwest Airlines.
Judge Approves $715 Million Adelphia Settlement
A federal judge on Wednesday approved a $715 million settlement by
Adelphia Communications Corp. to help compensate investors who lost
money in the bankrupt cable operator’s collapse, Reuters reported.
Judge Leonard Sand approved the deal that was agreed to by Adelphia and
the government on April 25 in a criminal case against the company. The
judges overseeing Adelphia’s bankruptcy and an action by the U.S.
Securities and Exchange Commission must approve the settlement as
well.
TXU Creditor Payout Dispute Gets July Court Date
The payout of 630 million pounds ($1.19 billion) by bankrupt energy
trader TXU Europe to its creditors has been snagged on a dispute which
Britain’s high court said late on Wednesday it would hear in July
or August, Reuters reported. TXU Europe filed for bankruptcy in November
2002 after a collapse in energy prices and KPMG, the administrators of
its finance companies, agreed in January to hand out 630 million pounds
in cash to creditors owed over 2 billion pounds.
Calpine Sued to Keep Plant-sale Proceeds in Canada
An investor in a Canadian subsidiary of struggling independent power
developer Calpine Corp. has filed a lawsuit to force the Canadian unit
to keep proceeds from the sale of a British power plant, Reuters
reported. The move aims to block the transfer of funds to parent Calpine
from the sale of its Saltend power plant in Britain. Analysts suggest a
sale could bring about $200 million in net proceeds.
UAL Flight Attendants Appeal Ruling on Pensions
The union representing flight attendants at bankrupt United Airlines
yesterday appealed a judge’s decision last week to allow the
carrier to turn its underfunded pension plans over to U.S. pension
insurers, Reuters reported. The Association of Flight Attendants (AFA)
hopes a higher court will overturn the May 10 bankruptcy court ruling
that lets United, a unit of UAL Corp., pass along its workers’
pensions to the Pension Benefit Guaranty Corp. The AFA said it filed the
notice of appeal in the U.S. District Court for the Northern District of
Illinois.