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Vertellus Specialties Inc., a global manufacturer of fine and specialty chemicals, announced that a bankruptcy court has approved the sale of substantially all of Vertellus' assets to the company's existing term loan lenders, the ABL Advisor reported on Friday. The Court's decision follows the successful resolution of all remaining objections raised by the company's creditors, environmental regulators and other business partners to allow for a consensual asset sale. The transaction is expected to be completed by the end of September.

The mediator trying to resolve the $18 billion bankruptcy of Caesars Entertainment Operating Co Inc. (CEOC) abruptly stepped down on Friday, Reuters reported. CEOC filed for bankruptcy in January 2015 amid creditor accusations that its parent Caesars Entertainment Corp. and private equity sponsors Apollo Global Management LLC and TPG Capital had stripped it of its best assets. Retired U.S. Judge Joseph Farnan was tasked in March to help the feuding parties reach a settlement and lift CEOC out of bankruptcy. "I'm convinced that I can't continue and possibly a new mediator will be able to establish a workable process," Farnan said in a letter published in a filing with the U.S. Bankruptcy court in Chicago. It was not immediately clear who, if anyone, would take over his role. Read more. 

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SandRidge Energy Inc. won court approval for a plan to exit bankruptcy on Friday, overcoming opposition from shareholders who had accused the oil and gas producer of misrepresenting its value, Reuters reported. Bankruptcy Judge David Jones said that he read every letter he received from individual shareholders, some of whom lost their entire savings, when SandRidge filed a prepackaged bankruptcy in May with $4.4 billion of debt. Judge Jones said he understood the pain that comes with losing an investment but was also aware that the reorganization plan was not to blame for the lost equity. "Equity was lost long ago," he said. Even though it is normal for shareholders to lose their investment during a bankruptcy, SandRidge's shareholders were hoping to prove its assets were valuable enough so they would recoup some money after repaying creditors. SandRidge said that it hoped to emerge from bankruptcy within the next month, eliminating $3.7 billion in pre-petition debt. Read more.

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Apollo Global Management LLC and TPG Capital offered to pay $250 million to help get Caesars Entertainment Operating Co. out of bankruptcy, according to two Apollo executives, contradicting claims that the casino company’s private-equity sponsors refused to spend their own money to make peace with creditors, Bloomberg News reported today. A mediator working to foster agreement between bondholders and parent company Caesars Entertainment Corp. asked Apollo and TPG whether they “would fund up to $250 million to reach a ‘best and final’ deal” that paid the bondholders 58 percent of what they are owed, Apollo executives Marc J. Rowan and David B. Sambur said in a filing on Wednesday in Chicago federal court. The mediator “was advised that the sponsors would provide the incremental funding,” Rowan and Sambur said in the filing, which asks U.S. Bankruptcy Judge A. Benjamin Goldgar to block the bondholders’ request for personal financial information. Settlement talks involving Rowan and Sambur last month failed to produce a deal, according to Wednesday’s filing. The executives said the bondholders demanded “several times” the $250 million offered.

For years, Wells Fargo employees secretly issued credit cards without a customer’s consent, created fake email accounts to sign up customers for online banking services. These illegal banking practices cost Wells Fargo $185 million in fines, including a $100 million penalty from the Consumer Financial Protection Bureau, the largest such penalty the agency has issued, the New York Times reported today. Federal banking regulators said that the practices, which date back to 2011, reflected serious flaws in the internal culture and oversight at Wells Fargo, one of the nation’s largest banks. The bank has fired at least 5,300 employees who were involved. In all, Wells Fargo employees opened roughly 1.5 million bank accounts and applied for 565,000 credit cards that may not have been authorized by customers, the regulators said in a news conference. The bank has 40 million retail customers.

The Hollywood Park, Texas-based owners of the Zio’s Italian Kitchen restaurant chain sought bankruptcy protection yesterday, blaming the downturn in the oil and gas industry and weakness in the casual dining sector for its financial woes, the San Antonio Express-News reported today. Zio’s Restaurant Co. operates 15 restaurant locations, including four in the San Antonio area and six overall in Texas. The restaurants are managed by FMP SA Management Group LLC, which is affiliated with Food Management Partners Inc. of Hollywood Park. In court papers filed in U.S. Bankruptcy Court in San Antonio, Zio’s Restaurant estimated its assets at less than $50,000 and liabilities ranging from $1 million to $10 million.

Chief Bankruptcy Judge Jeffery Deller yesterday approved a reorganization plan that will allow the amusement park Conneaut Lake Park to continue operating while it pays nearly $3.5 million in debts, GoErie.com reported yesterday. The mediated plan filed jointly by park trustees and creditors in July will allow the park to sell property and make quarterly payments from operating revenues to pay debts. A majority of park creditors approved the plan in August balloting. Conneaut School District, Crawford County and Sadsbury and Summit (Pa.) townships each voted to accept the repayment plan. The local taxing authorities are owed more than $1.3 million in delinquent park property taxes. Approval by a majority of creditors and repayment plan feasibility were factors in the plan's confirmation, said Judge Deller.

Pacific Sunwear of California Inc. won court approval to exit bankruptcy after cutting debt, closing some stores and pressuring landlords to reduce rent at the malls where the teen-clothing chain does business, Bloomberg News reported yesterday. Under the reorganization plan approved yesterday by Bankruptcy Judge Laurie Selber Silverstein, PacSun will give all its stock to affiliates of private equity firm Golden Gate Capital, its senior lender. In exchange, Golden Gate will reduce the amount it’s owed by PacSun to about $30 million initially from $88 million, Gary Schoenfeld, the retailer’s chief executive officer, said in an interview. Golden Gate has also agreed to invest $20 million in the company, most likely in form of new debt, he said. Read more. 

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