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Bonds of Puerto Rico’s struggling power utility rallied to the highest in more than year as the agency and its creditors hammer out proposals to repair its finances, Bloomberg News reported today. Some debt of the junk-rated authority, called PREPA, gained after creditors last week submitted a $2 billion plan that would help diversify fuel sources to stabilize energy costs. PREPA expects to release its own proposal in the next two months, said Lisa Donahue, the agency’s chief restructuring officer. PREPA, banks, investors and insurance companies are negotiating contracts to extend loans and give the agency time to create a turnaround plan. Those agreements end April 15. The utility faces a $415.6 million principal and interest payment to bondholders July 1, according to New York-based NewOak Capital LLC. PREPA has $236.4 million in reserve, according to a filing by its bond trustee on the Electronic Municipal Market Access website.

Chassix Holdings Inc. received bankruptcy court approval to access $250 million in debtor-in-possession financing, Crain’s Detroit Business reported on Saturday. The Southfield, Mich.-based automotive supplier filed for chapter 11 protection on March 12. The company, wholly owned by Tom Gores’ Platinum Equity LLC, filed a pre-packaged restructuring plan with support from 80 percent of its unsecured bondholders and 71.5 percent of its secured bondholders. The bondholders represent about $525 million in creditor claims of its $556.7 million in total debt. Chassix has $34.3 million in assets, according to a court filing.

The companies that own Hollywood Pavilion hospital, whose former CEO is currently in prison for Medicare fraud, filed for Chapter 11 reorganization to stay a foreclosure lawsuit, the South Florida Business Journal reported yesterday. Former Hollywood Pavilion CEO Karen Kallen-Zury was sentenced to 25 years in prison in 2013 after being convicted of more than $39 million in fraudulent billing by bribing patients to receive phony care at its facility. She has appealed her conviction. Later that year, the 58,189-square-foot hospital and rehab facility was hit with a foreclosure lawsuit. Subsequent to the lawsuit being filed, an entity related to South Miami, Fla.-based Larkin Community Hospital bought the distressed mortgage and took over management of both the 50-bed hospital and the 152-bed rehabilitation facility under a receivership court order. The foreclosure lawsuit is pending. http://www.bizjournals.com/southflorida/news/2015/04/09/hollywood-hospital-files-chapter-11-as-former-ceo.html?ana=twt

For more on hospital and medical bankruptcies, be sure to pick up a copy of the ABI Health Care Insolvency Manual, Third Edition from the ABI Bookstore. 

A judge yesterday said that Doral Financial Corp. could auction off its insurance arm with a $10.75 million bid by Anglo-Puerto Rican Insurance Corp. serving as the lead offer, the Wall Street Journal reported today. Bankruptcy Judge Shelley C. Chapman approved procedures for the auction of Doral Insurance Agency LLC, which Doral Financial had said would likely experience a “rapid and substantial decline” in value if it isn’t sold soon. Anglo-Puerto Rican, the lead bidder, would receive a $250,000 breakup fee if another party wins at auction, which will be held May 12 if competing bids emerge. Doral Financial, whose primary asset was Puerto Rico’s Doral Bank that failed in February, didn’t place the insurance unit into Chapter 11 when it filed for bankruptcy last month. But because about 40 percent of Doral Insurance’s commissions come from business generated by Doral Bank customers, that flow would be gone if Doral Bank is placed in receivership in Puerto Rico.

Tribune Media's three largest shareholders are looking to sell 25 percent of their combined stake through a secondary offering, the Chicago Tribune reported today. Oaktree Capital Management; Angelo, Gordon & Co.; and JPMorgan Chase, the former senior creditors who guided Tribune Co. out of bankruptcy, want to divest 9.2 million shares of Class A common stock through the proposed secondary offering. The selling shareholders also will grant underwriters an option to buy nearly 1.4 million additional shares, according to a registration statement filed with the Securities and Exchange Commission. The total value of the offering could be nearly $654 million, at a proposed maximum price of $61.53 per share, according to the filing. Tribune Media will not receive any proceeds from the secondary offering.

Erie Hockey LTD., the owner of the Ontario Hockey League's Erie Otters announced yesterday that they have filed for voluntary chapter 11 bankruptcy, YourErie.com reported yesterday. The Otters have been in a legal battle with the Edmonton Oilers of the National Hockey League over a forced sale of the team so that the Oilers could reclaim a $4.6 million loan they gave the Otters to maintain operations in exchange for Otters owner Sherry Bassin to sell the team to the Oilers at a later time. The deal fell through and the Oilers sued in federal court. The suit was dismissed in December.

Creditors say that retailer Cache Inc. has been running up bills it can't pay and should be pushed out of chapter 11 into a barebones form of bankruptcy, Dow Jones Daily Bankruptcy Review reported today. The official committee that represents landlords and suppliers to the women's dress and formalwear retailer Wednesday asked a bankruptcy judge to convert Cache's bankruptcy into a chapter 7 case and allow a trustee to take over the proceeding.

Bankruptcy Judge John Waites on Monday authorized lawyers for the Golf Club at Briar’s Creek in South Carolina to send the course’s sale proposal to current and former club members who are expecting to recover less than half of $13 million in owed refunds, the Wall Street Journal reported today. The proposal would sell the club to investors for $7.4 million in cash. Under the plan, investors — led by Houston Texans football team owner Bob McNair — would take over the private, 18-hole course near Charleston. Judge Waites promised to look over the voting results from members and other creditors at a May 13 bankruptcy confirmation hearing. The course, which employs about 50 people, filed for chapter 11 bankruptcy protection on Feb. 9, saying that it hasn’t been able to persuade more than a handful of people to build homes on its lots. The community, spread over more than 900 acres, has only eight developed housing lots, according to court documents. The club, which has about 210 members, also saw its membership shrink during the economic recession.

Caesars Entertainment Corp.’s $468 million bankruptcy dispute will go to trial in August as the judge overseeing the case said that it’s probably irrelevant whether the casino company or its creditors acted in bad faith when they filed dueling petitions in January, Bloomberg News reported yesterday. Whether Caesars paid its debts as they came due is the main question, Bankruptcy Judge Benjamin Goldgar said during a hearing yesterday. Judge Goldgar must decide if the bankruptcy started Jan. 15 when the company filed its case or three days earlier when lower-ranking creditors filed an involuntary petition. Creditors can challenge a claim by senior lenders to $468 million in cash if they win. Credit Suisse Group AG, acting as an agent for senior lenders that loaned Caesars billions of dollars, sued lower-ranking creditors on Tuesday claiming they violated lender agreements. The suit is one of several related to restructurings and refinancings by Caesars.

RadioShack has emerged from its steady decline with a big new rebirthing plan: Act more like a convenience store, according to a Washington Post analysis today. After the store waved the white flag of chapter 11 bankruptcy in February, its biggest creditor, Salus Capital Partners, fought to liquidate the Shack and squeeze out whatever value the brand had left. But Standard General, a hedge fund, pushed to keep open 1,740 of RadioShack's 4,000 stores, and a Delaware court last week approved the fund's takeover proposal. In its new life, the surviving Shacks plan to drop the unprofitable big-name gadgets — like cameras, laptops and tablets, which shoppers increasingly scooped up online — and the company will rebrand itself as "the premier community destination for consumer electronics," a national bodega of batteries and earbuds.