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A Houston light-fixtures manufacturer that took in $33.3 million in revenue last year has filed for bankruptcy, saying its search for buyers has been derailed by a lawsuit from former employees, WSJ Pro Bankruptcy reported. Executives who put XtraLight Manufacturing Ltd. into bankruptcy protection on Wednesday said that the company has spent a large amount of money fighting a $12 million lawsuit from employees who worked on a Boston water utility project. Nearly 30 employees who helped install automatic water-meter-reading systems sued the manufacturer in 2016 for unpaid wages. XtraLight has denied wrongdoing. The potential claim for wages and damages is a large figure compared to XtraLight Manufacturing’s overall value. Its lighting division, which began looking for buyers last year, is worth an estimated $18 million, owner Jerry Caroom said in documents filed in U.S. Bankruptcy Court in Houston. Legal fees from the dispute cost about $37,000 a month, he added.

Maverick Natural Resources, LLC, announced yesterday that it began operating on April 6, 2018, after it emerged from chapter 11 as the successor to Breitburn Energy Partners LP, according to a company press release. As a result of the restructuring process, Maverick has debt of approximately $105 million, which is substantially lower than Breitburn’s $2.96 billion debt balance prior to initiating the restructuring process. Maverick has approximately $295 million of additional borrowing capacity under a new bank credit facility. Maverick is majority-owned and controlled by funds and accounts managed by EIG Global Energy Partners.

Cumulus Media Inc. has received takeover interest, including one offer that valued the company at $1.3 billion, the company’s bankruptcy lawyer said Thursday, WSJ Pro Bankruptcy reported. “We got a couple of feelers. We got an offer for $1.3 billion,” said lawyer Paul Basta at a hearing in U.S. Bankruptcy Court in New York. Cumulus is attempting to get court approval for a balance-sheet restructuring plan that is being challenged by junior bondholders. At issue is the valuation the company is using to support its restructuring plan, which the junior creditors dispute. The chapter 11 plan says Cumulus is worth $1.675 billion and allots 83.5 percent of the equity in the reorganized business to senior lenders. Unsecured creditors, including junior bondholders, will only receive a 16 percent stake, which translates to a recovery of 14 cents on the dollar, on $600 million in liabilities.

Auto components maker Key Safety Systems yesterday completed its $1.6 billion deal to acquire air-bag maker Takata Corp, whose inflators triggered the auto industry’s biggest recall and have been linked to at least 22 deaths around the world, Reuters reported. After more than a decade of recalls, lawsuits and a criminal investigation which drove Takata to bankruptcy, the deal ensures the Japanese company will be able to continue producing replacement inflators before winding itself down, which may take years. The combined companies would be renamed Joyson Safety Systems, after a consortium led by KSS’s Chinese parent company, Ningbo Joyson Electronic Corporation, provided funding to acquire most of Takata’s operations, Joyson Safety Systems said in a statement. The new company will be based in Michigan.

Toys “R” Us Inc.’s U.S. business is in the midst of a wind-down, but its Asian business may have hope for survival, WSJ Pro Bankruptcy reported. The toy retailer has received multiple bids of more than $1 billion for a majority stake in its Asian business, the company’s bankruptcy attorney said yesterday in court. Interested bidders are looking to take an 85 percent stake in the Asian business. Bankruptcy lawyer Joshua Sussberg of Kirkland & Ellis updated the court on the status of the company’s Asian business during a hearing in which the Toys “R” Us won approval to borrow an additional $80 million under its bankruptcy loans to support its healthy overseas operations. Judge Keith Phillips of the U.S. Bankruptcy Court in Richmond, Va., gave interim approval for a higher debtor-in-possession loan, with a hearing for final approval set for April 27. The additional funds are needed to keep the toy retailer’s Central European and Asian units in business, lawyers for Toys ‘R’ Us and its creditors said at the hearing

The survival of Bon-Ton Stores Inc. suffered a blow yesterday when a bankruptcy judge denied bid-protection payments to a potential bidder that wants to keep the chain alive, WSJ Pro Bankruptcy reported. Judge Mary Walrath of the U.S. Bankruptcy Court in Delaware denied the payment of up to $500,000 to a group including New York investment firm DW Partners and landlords Namdar Realty Group and Washington Prime Group. The group had pledged to submit a bid that would keep Bon-Ton’s more than 250 stores alive. The payment would have been used toward paying the group’s fees and expenses related to the sale process. The lawyers pushing for the payment argued that the offer could keep up to 24,000 people employed. While Judge Walrath denied the payment, the consortium may still show up at Monday’s auction. DW Partners and the landlords submitted a letter of intent, which included a $128 million offer, with conditions that include the $500,000 payment and representations that some vendors are willing to stay on board with the company through its emergence. Read more. 

A special episode of “Eye on Bankruptcy” focused on the next wave of retail cases will be taped before a live audience at the Annual Spring Meeting! Watch a preview. To register for the Annual Spring Meeting, please click here. 

Occupancy issues are at the heart of many significant retail cases, as detailed in the forthcoming ABI publication Retail and Office Bankruptcy: Landlord/Tenant Rights, available now at the ABI Store. 

The bankrupt Boston Herald plans to pay former workers who are owed about $1.2 million in severance about 37 cents on the dollar, according to a disclosure statement filed on Friday in court, WSJ Pro Bankruptcy reported. The document also shows that general unsecured creditors are getting about 11 cents on the dollar for the $68.1 million they are owed. The Boston Herald’s owner, Herald Media Holdings Inc., sought protection from creditors in December in U.S. Bankruptcy Court in Wilmington, Del. In March the company was bought for nearly $12 million out of bankruptcy by Digital First Media, which is owned by hedge fund Alden Global Capital LLC. Digital First, like two other companies that bid on the Boston Herald’s assets in bankruptcy, plans to keep about 175 of 240 current workers and won’t recognize collective bargaining agreements after the bankruptcy. William Baldiga, a Brown Rudnick LLP lawyer representing the Boston Herald, said yesterday that severance claims could have been much higher had Digital First and other bidders not agreed to make employment offers to almost three-fourths of workers.

With a crucial court hearing just days away, junior creditors have formed ranks to challenge Cumulus Media Inc.’s bankruptcy exit plan, WSJ Pro Bankruptcy reported. Operator of one of the country’s largest chains of radio stations, Cumulus Media says that its business is worth enough to pay off only its top-ranking lenders in full. Unsecured creditors, including bondholders owed more than $600 million, will get less than 14 cents on the dollar, if Cumulus’s chapter 11 exit plan wins court approval. Bankruptcy Judge Shelley Chapman will start taking evidence on Thursday in a New York bankruptcy courtroom. Cumulus filed for chapter 11 protection on Nov. 29, 2017, after months of trying to appease competing camps of creditors by offering to swap equity for debt. Ultimately, the company made a deal with senior lenders owed $1.7 billion, spurning competing overtures from bondholders.

Commodity trader Noble Group Ltd said yesterday that it is getting growing support for a $3.4 billion restructuring plan after more than 70 percent of creditors holding the majority of its senior debt accepted the initiative, Reuters reported. The proposed restructuring agreement requires approval by a majority of existing senior creditors representing 75 percent in value of its debt. Noble added that advisers to the ad hoc group and the company are in talks with about 10 percent of additional creditors who support the proposed financial restructuring, subject to accepting the restructuring and completing internal approval processes. “The company remains confident that the number of creditors acceding into the RSA (restructuring support agreement) will continue to rise,” said the Hong Kong-headquartered firm. Noble warned last month that it would begin insolvency proceedings if the debt restructuring was not approved.