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September 21,
2005
name='1'>Frist Asks
for Pension Compromise
Senate Majority
Leader Bill
Frist (R-Tenn.) asked the chairmen of the two committees that have
produced
pension bills to forge a compromise within days, Congress Daily
reported
today. Pension legislation has gained renewed pertinence due to the
Delta and
Northwest filings, leading to concern that they might default on their
pension
obligations. Also, a CBO report predicted the nation’s pension
insurer
would have a larger-than-expected debt over the next 10 years. Frist
said that
he is waiting for a proposal from Finance Chairman Chuck Grassley
(R-Iowa) and
Health, Education, Labor and Pensions Chairman Michael Enzi (R-Wyo.),
whose
panels have adopted separate pension bills. Frist said that he would
schedule
a floor vote "after they come back with a product."
href='http://nationaljournal.com/pubs/congressdaily/'>Read
the full story.
id='2'>Entergy
Unit to Consider Bankruptcy
Facing huge costs
for rebuilding
its Hurricane Katrina-devastated systems along the Gulf Coast, power
and gas
utility Entergy Corp. will consider filing for bankruptcy protection
for its
New Orleans unit, the Associated Press reported yesterday. Entergy,
whose Entergy
New Orleans unit has lost up to an estimated 130,000 customers because
of the
hurricane, estimates the unit’s storm-related costs at $325
million to
$475 million. The company put its total estimated costs for repairing
and replacing
electric and gas facilities at $750 million to $1.1 billion. New
Orleans-based
Entergy delivers electricity to 2.7 million customers in Arkansas,
Louisiana,
Mississippi and Texas, and provides natural gas to nearly 240,000
customers
in Louisiana. It owns and operates power plants and is the
second-largest nuclear
generator in the United States. Entergy also said that it plans to
pursue various
avenues for recovering costs from the storm. Louisiana Public Service
Commission
member Foster Campbell, a frequent critic of Entergy, said that he
would expect
the company to provide detailed proof of the need for higher rates,
and that
he likely would oppose them under any scenario. But a Wall Street
analyst said
that it is almost inevitable that part of the tab for rebuilding will
wind up
on customer bills.
href='http://www.businessweek.com/ap/financialnews/D8CO7J2G1.htm?campaign_id=…'>Read
more.
id='3'>Delphi
CEO Would Rather Not File, Says Credit Well Is Not Dry
Delphi Corp. CEO and Chairman Robert “Steve” Miller
said that
href='http://today.reuters.com/news/newsArticleSearch.aspx?storyID=81987%2B21…'>he
would rather fix the company out of court rather than file for
bankruptcy
protection, the Wall Street Journal reported on today.
Miller has
previously said that Delphi needs to negotiate concessions from its
union
workers and financial assistance from General Motors Corp., its
former parent,
or it would consider filing for bankruptcy protection by Oct. 17.
In other news, Delphi said that it had not drawn on the remaining
$300 million
under its $1.8 billion credit line, shooting down market rumors that
it had
completely tapped out that source of liquidity. The company’s
shares
slid more than 10 percent to an all-time low on Tuesday as concerns
mounted
about Delphi’s financial condition.
id='4'>Fed
Raises Rate 11th Time
The Federal Reserve
continued
its campaign to keep inflation in check, raising a key interest rate
yesterday
that serves as the benchmark for millions of consumer and business
loans, Florida
Today reported. The Fed raised its target for the federal funds
rate—the
interest that banks charge each other—by a quarter-point to 3.75
percent.
That’s the highest level since the summer of 2001. Some
economists believed
that Hurricane Katrina would prompt the Fed to temporarily pause its
drive for
higher interest rates. But Federal Reserve Chairman Alan Greenspan and
his colleagues
said that Katrina’s impact on the economy is likely to be
short-lived.
The Fed’s rate increase should spur commercial banks around the
nation
to increase their prime lending rate by a quarter-point. That would
push the
prime rate, which sets the tone for consumer and business loan rates,
to 6.75
percent—its highest level in more than four years.
href='http://www.floridatoday.com/apps/pbcs.dll/article?AID=/20050921/BUSINES…'>Read
more.
id='5'>O.C.
Diocese Pays Off Debt
The Roman Catholic
Diocese
of Orange County, Calif., has paid off most of the debt stemming from
last year’s
$100 million settlement with alleged victims of clergy abuse,
SignonSanDiego.com
said Monday. The diocese took out a $50 million loan from Bank of
America to
fund payouts to some 90 plaintiffs and relied on insurers to pay the
balance,
according to a diocese statement. Last month, it paid down about $35
million
of the loan with proceeds from the sale of some of its investments,
said Rob
Fitzgerald, a retired executive who helped advise church officials.
Plans are
to pay off another $5 million to $10 million by February before
retiring the
loan next June. The diocese did not rely on money or investments
earmarked for
its parishes and schools, Fitzgerald said.
href='http://www.signonsandiego.com/news/state/20050919-1720-ca-calchurchabus…'>Read
the full story.
Airlines
id='6'>US
Airways to Raise $297 Million
US Airways Group
Inc., which
expects to exit bankruptcy protection by next month, has filed to
raise as much
as $172.5 million through the sale of new stock, the Pittsburgh
Business
Journal reported today. It will also raise $125 million in a
private offering
of private notes. The airline filed with the Securities and Exchange
Commission
to sell as many as 9.78 million shares. Merrill Lynch will manage the
stock
offering, which will take place after the America West merger closes,
US Airways
said in the filing. Separately, US Airways said it will sell
convertible notes
to institutional investors, valued at $125 million and due in 2020.
href='http://pittsburgh.bizjournals.com/pittsburgh/stories/2005/09/19/daily11…'>Read
more.
id='7'>NWA
Chief Sold Shares Just Before Bankruptcy
Less than a month
before
Northwest Airlines Corp. filed for bankruptcy, its chairman sold
nearly a third
of his remaining shares, Airport Business News reported today.
Northwest’s
stock price, which closed at 84 cents Monday, was worth more than $5
when NWA
CEO Gary Wilson sold 258,100 shares of his 904,940 shares in the
airline. Northwest
spokesman Bill Mellon said that the sales were a "personal
decision by
Mr. Wilson."
href='http://www.airportbusiness.com/article/article.jsp?id=3577&siteSection=3'>Read
more.
id='8'>ATA
Airlines and ALPA Tentative Agreement Reached
ATA Holdings Corp.
announced
that it has reached a tentative agreement with its cockpit
crewmembers, represented
by the Air Line Pilots Association for a revised three-year collective
bargaining
agreement, BankruptcyData.com reported yesterday. As part of the
agreement,
the cockpit crewmembers will receive stock options to purchase common
shares
of the reorganized ATA in exchange for wage, benefit and work rule
concessions.
The tentative agreement is subject to a ratification vote of the
cockpit crewmembers
in the next two weeks.
href='http://www.bankruptcydata.com/BankruptcyDataNewsNEW.asp'>Read
the full story.
id='9'>Kaiser
Settlement, Agreement Approvals Sought
Kaiser Aluminum
filed a motion
seeking U.S. Bankruptcy Court approval of a modification to the
settlement agreement
with the Pension Benefit Guaranty Corp. (PBGC), BankruptcyData.com
reported
yesterday. Among other things, the modification allows the PBGC to
pursue its
appeal of the distress termination order to the Third Circuit. The
modification
also grants the PBGC an $11 million allowed administrative claim,
rather than
the $14 million claim allowed in the original agreement. The company
also filed
a motion seeking court approval of its second amended and restated
agreement
with the United Steelworkers.
href='http://www.bankruptcydata.com/BankruptcyDataNewsNEW.asp'>Read
more.
id='10'>Artifacts
Dealer Files Chapter 11
Ohio antiquities
dealer Bruce
Ferrini, who exhibited a private collection of Dead Sea Scroll
fragments in
Akron in spring 2004, has filed for chapter 11 bankruptcy, the
Akron Beacon
Journal reported yesterday. Ferrini made the electronic filing in
the U.S.
Bankruptcy Court for the Northern District of Ohio in Akron on Sept.
15. According
to court records, Ferrini owes between $1,000,001 and $10 million to
more than
80 creditors, including credit card companies, banks, the state of
Ohio and
Medina, Ohio resident Evelyn DiBello, who was the publicity
chairperson for
the exhibit.
id='11'>Kansas
Hockey Team Auctioned Off
After a last-minute
bidding
war, Horn Chen reacquired the Wichita Thunder’s assets
yesterday, the
Witchita Eagle reported today. The Central Hockey League team
declared
chapter 11 bankruptcy in November of 2004. The Thunder’s assets,
including
player equipment, merchandise and trademark, were auctioned to benefit
creditors
after the bankruptcy was converted to chapter 7. The initial bid from
Chen,
a Chicago businessman who has owned the team since it formed in
1992-93, was
for $32,925. On Monday, Trustee Carl Davis said that the initial bid
of $32,925
"would not even come close" to satisfying the team’s
debt to
creditors. When the Thunder filed bankruptcy, it listed liabilities of
$817,191
and assets of $9,861. "Bankruptcy is always an unfortunate aspect
of business,
but, fortunately, it’s over,” Chen said.
“We’re certainly
looking forward to a good season."