href='mailto:Headlines@abiworld.org?subject=Subscribe me to the ABI
Headlines Direct'>
src='http://www.abiworld.org/AM/Images/headlines/headline.gif'>
January 22, 2007
name='1'>California Lumber Company Files for Chapter
11
w:st='on'>
size='3'>California
Pacific Lumber Co. and its subsidiaries filed for chapter 11 protection
on Thursday, citing regulatory limitations as the main cause of a recent
liquidity problem,
size='3'>Bankruptcy Law360 reported on Friday.
PALCO, which is based in the company town of
w:st='on'>
size='3'>Scotia
w:st='on'>
size='3'>Calif.
over 200,000 acres of forestry land in
w:st='on'>
w:st='on'>
size='3'>County
size='3'>Calif.
its subsidiaries. Its sales account for 45 percent of the national
redwood lumber market, court documents said. Founded in 1863, PALCO hit
some regulatory speed bumps in recent years after it made an agreement
with the Federal government and
w:st='on'>
size='3'>California
the Headwaters Agreement, which placed restrictions on timber
harvesting.
href='http://bankruptcy.law360.com/Secure/ViewArticle.aspx?id=16760'>Read
more. (Registration required.)
PBGC
Takes over Kaiser Aluminum Pension Plans
The Pension Benefit Guaranty
Corp. (PBGC) said Friday that it had taken responsibility for pension
plans covering nearly 900 workers and retirees of Kaiser Aluminum &
Chemical Co., the Associated Press reported on Saturday The PBGC
estimated that the four pension plans had combined assets of $20.1
million to cover promised benefits totaling $29.6 million. The agency
said it would be liable for $2.7 million of the $9.5-million
shortfall.
href='http://www.latimes.com/business/investing/la-fi-kaiser20jan20,1,4989063.story?coll=la-headlines-business-invest'>Read
more.
name='3'>Congress Weighs US Air-Delta Merger Proposal at Hearing on
Wednesday
Congressional lawmakers are
concerned that a merger between US Airways and Delta Air Lines will
trigger wider consolidation and hurt consumers by reducing service and
increasing fares as the hostile proposal is considered at a Senate
Commerce Committee hearing on Wednesday, Reuters reported yesterday.
Concern centers on losing hubs, routes or low-cost service mainly in
eastern states. Lawmakers are also sensitive to more industry job losses
and pension cuts. Unionized pilots at bankrupt Delta oppose the $10.5
billion merger with US Airways. Atlanta-based Delta is trying to
convince members the merger would harm service and face uphill antitrust
review. Delta CEO Gerald Grinstein says Delta will be stronger on its
own.
href='http://www.washingtonpost.com/wp-dyn/content/article/2007/01/21/AR2007012100452_pf.html'>Read
more.
name='4'>Air
size='3'>Nears
size='3'>Sale
size='3'>New York
size='3'>Family
Air America radio's
parent company may have found a new rescuer in the French family of
Westchester County, N.Y., which owns New York City-area television
concern WRNN, the Wall
Street Journal reported today. A consortium of
investors led by the French family is on the verge of signing a deal to
purchase the assets of Piquant LLC, which filed for chapter 11
protection in
face='Times New Roman' size='3'>New York
in October. An agreement could be announced as early as
today and would need to be approved by the bankruptcy court. If the deal
doesn't go through, it increases the likelihood that Piquant could face
imminent liquidation.
href='http://online.wsj.com/article_print/SB116942647872883236.html'>Read
more. (Registration required.)
Values Nellson Nutraceutical at $320 Million
Bankrupt diet food maker
Nellson Nutraceutical is worth much less than originally estimated,
which may jeopardize the ability of its main equity holder to retain its
stake in the company,
size='3'>Bankruptcy Law360 reported on
Friday. Judge Christopher S. Sontichi of
the U.S. Bankruptcy Court for the District of Delaware has put the
company’s value at about $320 million, despite the company’s
earlier estimate that the business is worth $400 million. Nellson filed
for chapter 11, listing assets of $100 million and debts of $365
million. The company, along with controlling shareholder Fremont
Capital, originally claimed that the company was worth $404.5 million.
However, Sontichi dismissed Nellson’s estimate of the
company’s worth, ruling that
w:st='on'>Fremont had
manipulated Nellson and its business plan in order to benefit
itself.
href='http://bankruptcy.law360.com/Secure/ViewArticle.aspx?id=16776'>Read
more. (Registration required.)
name='6'>Enesco Seeks Approval to Auction Assets
Enesco Group Inc., which
designs and makes giftware and home decor items, is seeking bankruptcy
court approval to auction off its assets after seeking chapter 11
protection Jan. 12, the
Chicago Tribune reported on Saturday. The
Itasca, Ill.-based company will ask the U.S. Bankruptcy Court in Chicago
to sign off on the auction, and proposed lead bidder Tinicum Capital
Partners II LP, at a hearing today. Tinicum, a
w:st='on'>
York investment firm, has
agreed to open bidding for Enesco's assets with an offer that would
cover the company's senior secured debt. Enesco said it owes its senior
lenders about $56 million.
href='http://www.chicagotribune.com/business/chi-0701200024jan20,0,1311566.story?coll=chi-business-hed'>Read
more.
name='7'>Bankrupt Centrix Wins
w:st='on'>Sale
size='3'>Approval
The U.S. Bankruptcy Court
in Denver approved the sale of most of auto finance lender
Centrix’s assets after the company’s founder, Robert Sutton,
dropped most of his objections to the sale, Bankruptcy Law360 reported on
Friday. The lending business will be sold for $30 million to an
investment group established by Falcon Investment Advisors, one of the
company’s senior lenders. Judge
size='3'>Elizabeth Brown approved the auction
last November, allowing Centrix to hold a sales hearing and accept bids.
The sale faced criticism by Sutton, who withdrew his opposition only
last week after Brown overruled most of his objections. Sutton, who will
retain a 5 percent stake in the company, had insisted the sale be
conditional on creditors releasing their claims against him.
href='http://bankruptcy.law360.com/Secure/ViewArticle.aspx?id=16788'>Read
more. (Registration required.)
name='8'>Union Approves
w:st='on'>
size='3'>Pittsburgh
Contract
Union workers approved a
contract with Pittsburgh Brewing Co. on Sunday that includes wage and
benefit reductions, paving the way for the brewery to emerge from
bankruptcy, the Associated Press reported today. The union voted 66-52
to accept the three-year deal if prospective owner Pittsburgh Brewing
Acquisition takes over. Pittsburgh Brewing Acquisition hopes to take
over the brewer of
w:st='on'>
size='3'>Iron
face='Times New Roman' size='3'>City
and other beers in March. Union business manager George
Sharkey said the contract includes a wage reduction of 15 percent, from
about $17 to $15.50 an hour, along with a reduction of about one week's
vacation. The pension will also be replaced with a 401K plan.
href='http://www.boston.com/news/local/connecticut/articles/2007/01/22/union_approves_pittsburgh_brewing_contract/'>Read
more.
name='9'>Commentary: Case Exposes Asbestos Trust
Abuses
When Ohio Judge Harry
Hanna of the Cuyahoga County Court of Common Pleas barred California law
firm Brayton Purcell, one of the giants of the asbestos bar, from
practicing in his court, he exposed one of the darker corners of tort
abuse: asbestos trusts, or funds set up by bankrupt companies to pay
legal claims, according to a
size='3'>Wall Street Journal editorial today.
The judge is overseeing a suit brought by Brayton Purcell, which claimed
Lorillard Tobacco's cigarettes had caused the late Harry Kananian's
mesothelioma. What emerged in court, however, is that Brayton Purcell
and other firms had previously filed numerous claims to other asbestos
trusts claiming that Kananian had developed his asbestos cancer for
different reasons. In his opinion, Judge Hanna found that Brayton
Purcell disobeyed court orders and lied to the court.
href='http://online.wsj.com/article_print/SB116942159908683141.html'>Read
more. (Registration required.)
name='10'>Commentary: Hedge Funds and Insider Trading
With weak safeguards and
large amounts of investments riding on their success, the regulators and
legislators need to do more to guard against the possibility of a
destabilizing meltdown that only grows the longer that hedge funds
escape oversight, according to a
size='3'>New York Times editorial today.
Shortly before he resigned as
face='Times New Roman' size='3'>New York
size='3'>’s attorney general to become the governor, Eliot Spitzer
opened investigations into whether employees at companies including Best
Buy and
face='Times New Roman' size='3'>Circuit
size='3'>City
improperly given nonpublic information to hedge fund managers. Two
research firms, the Gerson Lehrman Group and Vista Research, a unit of
McGraw Hill, are also under investigation.
w:st='on'>
York’s new attorney
general, Andrew Cuomo, should pursue any wrongdoing and the 110th
Congress should move forward with hedge fund regulation.
href='http://www.nytimes.com/2007/01/22/opinion/22mon3.html?pagewanted=print'>Read
more.
name='11'>Brokerage Firms Approve Single Securities
Regulator
The NYSE Group and NASD
have won approval from brokerage firms to form a single regulator for
the U.S. securities industry, overcoming
opposition from a group of small firms, Bloomberg News reported today.
Sixty-four percent of members of NASD approved combining its regulatory
operations with those of NYSE to create a single watchdog, according to
NASD. NASD, a private-sector provider of financial regulatory services
with 5,058 brokerage firms, said almost 83 percent of eligible members
voted during a 33-day election period. The combination, first announced
on Nov. 28, was backed by the largest Wall Street firms, who cited the
cost and redundancy of complying with rules enforced by two industry
watchdogs. Officials, including the Security and Exchange
Commission’s chairman, Christopher Cox, said the change would
improve the policing of financial markets.
href='http://www.nytimes.com/2007/01/22/business/22NASD.html?pagewanted=print'>Read
more.
International
name='12'>Key Critics Drop Opposition to Eurotunnel
Plan
Two of the biggest
opponents to Eurotunnel’s plan to restructure its €9.4
billion in debt have backed off their campaign, further clearing the
path for the channel operator to soon emerge from bankruptcy,
Bankruptcy Law360
reported on Friday.
w:st='on'>
size='3'>U.S.
size='3'>investment fund Oaktree Capital Management and Franklin Mutual
Advisers agreed to abandon their litigation against the company on
Wednesday in exchange for a portion of the underwriting fees. The move
comes only days after the
w:st='on'>Paris Commercial
Court
size='3'>approved
size='3'>Eurotunnel’s restructuring plan, removing one of the last
obstacles for the operator to emerge from bankruptcy.
href='http://bankruptcy.law360.com/Secure/ViewArticle.aspx?id=16726'>Read
more. (Registration required.)
TROUBLED COMPANIES IN THE
NEWS
1000’s of companies
lose money or experience some form of difficulty each
quarter.
The business news
articles below are taken from the
size='3'>Daily Summary of Troubled & Fast Growing U.S. Companies and
Other Business News published by Bastien
Financial Publications.
To begin receiving the COMPLETE
Daily e-Summary, that emails you information on over 70 such companies
each morning, email
face='Times New Roman' color='#0000ff'
size='3'>steve@creditnews.comyour name, company name, address, phone and
fax. We’ll set
you up within 24 hours.
Receive an ABI
member’s discount of 50% off the $500 annual subscription
fee. Indicate
“ABI CODE 27” in your email.
size='3'>California Micro Devices Corp.,
a
Ca. maker of integrated circuits, reported its third quarter net income
sank 73%--to $670,000. Revenue was down nearly 10%--to $17.7
million.
Graco Children's
Products Inc., a unit of Newell Rubbermaid Inc. of
size='3'>Atlanta
w:st='on'>
size='3'>Ga.
about 100,000 of its Graco Contempo highchairs, which reportedly can
collapse if they aren't properly locked into place.
size='3'>
size='3'>HEI Inc., a
w:st='on'>
size='3'>Victoria
w:st='on'>
size='3'>Minn.
microelectronic components, reported a first quarter net loss of $1.6
million. Revenue declined 6%--to $12.9 million.
size='3'>
size='3'>Isonics Corp. has seen a 3/1 hearing
scheduled with Nasdaq to determine whether its stock will be delisted
from trading on the Nasdaq Capital Market.
size='3'> The company wants to present a
plan at the hearing in order to regain compliance with listing
requirements. Isonics, based in Golden, Co., provides homeland-security
and semiconductor products.
size='3'>Pulte Homes Inc., a
w:st='on'>
size='3'>Bloomfield
w:st='on'>
size='3'>Mich.
size='3'>homebuilder, reduced its outlook for earnings in the fourth
quarter and warned that per-share operating results will be between a
loss of 5 cents a share and a profit of 5 cents a share. Impairments and
land-related charges could be as high as $350 million in the
quarter.
size='3'>Saxonburg Ceramics Inc. in
County
w:st='on'>Pa.
is shuttering its
face='Times New Roman' size='3'>Butler
size='3'>facility and selling its manufacturing plant in
size='3'>Monroe
w:st='on'>
size='3'>N.C.
Ceramics Co., a local Saxonburg Ceramics competitor, for an undisclosed
amount. Saxonburg Ceramics makes ceramics insulators.
size='3'>
Strattec Security Corp., a
w:st='on'>Milwaukee
w:st='on'>Wis.
reported its second quarter net income fell 59%--to $1.1 million.
Revenue declined 12%--to $37.9 million.