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June 22, 2006
id='1'>Autoworkers
size='3'>Union
‘At-Risk’ Proposal of Pension
Legislation
The United Auto Workers
would oppose a bill to overhaul the traditional
w:st='on'>
size='3'>U.S.
size='3'>pension system if it kept a current proposal for identifying
pension plans at risk of default, a union official said, according to a
Reuters report yesterday. Last December, the union's endorsement of a
different version of the pension bill broke a logjam within the House of
Representatives, which then passed it by a sizable margin. Republican
negotiators recently proposed a framework to define which pension plans
are so poorly funded that they are at risk of default and must add cash.
But UAW legislative director Alan Reuther said that an 'at-risk'
provision would penalize companies that put more than the minimum
required into pension plans in the past. The union backs changes
proposed by Senate Democrats, he added.
href='http://www.washingtonpost.com/wp-dyn/content/article/2006/06/21/AR2006062101263.html'>Read
more.
J.L.
French to Emerge from
Bankruptcy
J.L. French Automotive
Castings Inc. said that it expects to emerge from bankruptcy on June 30
after the bankruptcy court approved the company's plan of reorganization
Wednesday, the Business
Journal of Milwaukee reported yesterday. The
Sheboygan, Wis.-based die-cast aluminum automotive components supplier
said that it will come out of an 18-week bankruptcy with $130 million in
new equity and $255 million in new financing. It will also have shed
$465 million in first-and second-lien senior secured debt and $28.9
million in 11.5-percent senior subordinated unsecured notes, company
chairman, president and CEO Jack Falcon said.
href='http://www.bizjournals.com/milwaukee/stories/2006/06/19/daily30.html?t=printable'>Read
more.
Judge
Set To Approve ABB
Lummus Chapter 11 Plan
A federal bankruptcy
judge has signaled that she intends to confirm the chapter 11 plan of
ABB Lummus Global Inc., enabling another unit of Swiss parent company
ABB Ltd. to shift its asbestos liabilities into a court-approved trust
fund, Portfolio
Media reported yesterday. On Wednesday,
Judge Judith
Fitzgerald indicated at a hearing that
she would sign off
on the proposed reorganization plan as soon as the documents are in
final order. ABB Lummus' chapter 11 case will then go to a federal
district judge for a last signature, marking a quick stay in bankruptcy
for the oil and petrochemical technology company. ABB Lummus filed for
bankruptcy on April 21, listing assets of $414 million and debts of $553
million.
Judge
Allows Calpine to Quit
Paying Bondholders’ Fees
In a setback for Calpine
Corp.’s first-lien bondholders, a bankruptcy judge has permitted
the energy giant to stop making monthly payments to professionals
representing the investor group that pushed the company into
bankruptcy, Portfolio
Media reported yesterday. Judge
Burton Lifland
size='3'>decided Wednesday in the U.S. Bankruptcy Court
for the Southern
District of New York that Calpine’s obligation to pay roughly
$350,000 a month for first-lien bondholders’ lawyers and advisers
came to an end May 26, the same day that Calpine fully reimbursed the
investor group with $646.1 million. Lifland found that Calpine’s
request to stop the professional payments was in the best interests of
the company’s assets, its creditors and other interested
parties.
id='5'>Hedge Fund
Opposes
size='3'>Delphi
Plan
Distressed-debt hedge
fund Appaloosa Management LP came out against the bankrupt auto parts
maker Delphi Corp’s proposal to reduce its work force through
early retirement buyouts,
size='3'>Portfolio Media reported yesterday.
The hedge fund filed a preliminary objection with the U.S. Bankruptcy
Court in
size='3'>Manhattan
size='3'>Delphi
buyouts would help the company. Appaloosa, the leader of an ad
hoc equity committee that represents about 21 percent of
size='3'>Delphi
said that the buyouts would cost billions of dollars, potentially exceed
the benefits to be gained and still leave open the possibility of a
strike by union workers.
id='6'>Three-Five Systems Reaches
Key Settlements, Preparing to Exit Bankruptcy
Three-Five Systems Inc., a
global provider of electronic products manufacturing to original
equipment manufacturers, has reached a settlement agreement with
TFS Electronic Manufacturing Systems Inc. and its unsecured
creditors’ committee, according to a company press release
yesterday. The settlement with the committee resolves a lawsuit filed by
the unsecured creditors in the company’s chapter 11 bankruptcy
case. On June 13, Three-Five Systems presented the settlement agreement
to the bankruptcy court, which had drawn objections from Willows, the
unsecured creditors’ committee, the SEC, the U.S. Trustee and the
equity holders’ committee. The court has set a June 30 deadline
for objections to the settlement agreement and a July 7 hearing date for
href='http://www.forbes.com/prnewswire/feeds/prnewswire/2006/06/21/prnewswire200606211709PR_NEWS_B_WES_LA_LAW089.html'>Read
more.
id='7'>SGI Creditors Endorse
Move to
face='Times New Roman'
size='3'>California
size='3'>Court
Computer maker Silicon
Graphics Inc. (SGI) garnered the support of its unsecured creditors on
Monday in its attempt to move its chapter 11 case from
w:st='on'>New York
City
w:st='on'>Northern
California
headquartered, Portfolio
Media reported yesterday. In court papers
filed with the U.S. Bankruptcy Court in Manhattan, the official
unsecured creditors’ committee argued that because SGI’s
main operations, employees, assets, business records and
management” are located in Mountain View, Calif., the court must
dismiss or transfer a case when the venue is improper according to the
Federal Rules of Bankruptcy Procedure. A hearing on the
committee’s request is scheduled for June 29, with objections due
June 26.
id='8'>Techneglas Asks Judge to
Close Out Bankruptcy
Nearly two years after
television glass manufacturer Techneglas Inc. closed its
size='3'>Jenkins
face='Times New Roman' size='3'>Township
size='3'>Pa.
asked a federal judge to close its bankruptcy case, the
face='Times New Roman' size='3'>Wilkes Barre Times-Leader
reported today. In paperwork filed with the judge this
week in Columbus, Ohio, where the company’s headquarters are
located, Techneglas said that it either has or will pay out more than
$69.7 million in claims, with nearly a third of the total going toward
pension benefits. Bankruptcy Judge John E. Hoffman Jr. could
decide this week on the request and close the book on what once was one
of the largest and highest-paying manufacturers in northeast
Pennsylvania.
href='http://www.timesleader.com/mld/timesleader/14874254.htm'>Read
more.
International
id='9'>Chairman Predicts Bleak
Future for Yukos
Viktor V. Gerashchenko,
the chairman of the board of Yukos, offered a glum assessment of the
future of his bankrupt Russian oil company, the
face='Times New Roman' size='3'>New York Times
size='3'>reported today. Yukos was once
w:st='on'>
size='3'>Russia
largest oil company, worth more than $40 billion at its peak. But the
company's fortunes changed in 2004 when
w:st='on'>
size='3'>Russia
size='3'>seized its largest subsidiary to pay billions of dollars in
taxes that the government said Yukos owed. Yukos fell into bankruptcy
court this spring after a long and politically tinged tax dispute with
the Kremlin. Still, the remaining two large oil fields, five refineries
and 1,300 filling stations are worth $15 billion to $20 billion,
according to Yukos. Gerashchenko, a former Russian central banker,
seemed to reinforce the assessment of oil analysts that the rest of
Yukos would soon be sold to the state.
href='http://www.nytimes.com/2006/06/22/business/worldbusiness/22yukos.html?pagewanted=print'>Read
more.
id='10'>Debt Has Brazilian
Airline Mostly Grounded
Brazil's embattled
flagship airline, Varig, suspended service indefinitely to dozens of
destinations and canceled more than half of its flights, stranding
passengers in Brazil and abroad as creditors continuted to tried to
seize its planes, the Associated Press reported today. Varig, which has
been in bankruptcy protection since June 2005, canceled 180 of its 356
flights in
America, Europe and the
face='Times New Roman' size='3'>United
States
w:st='on'>
size='3'>Brazil
Agencia Estado news service reported. Varig's financial troubles left
all but 25 of the company's 61 jets inactive, local media said. On
Wednesday, Judge Robert
D. Drain of the U.S. Bankruptcy Court in
Manhattan extended an injunction preventing leasing companies from
seizing the planes for one month to give the airlines' new owners time
to restructure the company.
href='http://www.washingtonpost.com/wp-dyn/content/article/2006/06/21/AR2006062102035_pf.html'>Read
more.
href='http://www.washingtonpost.com/wp-dyn/content/article/2006/06/21/AR2006062102035_pf.html'>