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Bankruptcy Judge Kevin Carey yesterday granted chapter 15 protection to Spain’s Abengoa SA over the objections of a group insurance companies who claimed the energy company’s talks to restructure billions in debt was unfair to U.S. creditors, the Wall Street Journal reported today. Recognition of the Spanish proceeding locks in a pre-insolvency standstill agreement Abengoa struck with key creditors that gives it more time — through Oct. 28 — to continue negotiations on restructuring its debts, which court papers show total more than €14.6 billion ($16.48 billion). A group of insurance companies that has issued some $250 million in surety bonds tied to Abengoa’s construction of U.S. power plants had balked at the U.S. court’s recognition of the Spanish proceeding. The companies — including Liberty Mutual Insurance Co., AIG and Zurich American Insurance Co. — called the Spanish proceeding “manifestly contrary” to U.S. public policy because it forced them to abide by a standstill agreement without due process. Judge Carey said the lawyers for the insurers were arguing that the Spanish restructuring proceedings should only be recognized if they were identical to a U.S. bankruptcy proceeding. “They don’t have to be identical to a U.S. bankruptcy proceeding,” he said in his ruling from the bench. Read more. (Subscription required.) 

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Sports Authority’s creditors battled the failing retailer and its lenders to a standstill over bankruptcy financing that critics said offered no funding for a last-ditch effort to save the company, the Wall Street Journal reported today. Bankruptcy Judge Mary Walrath on Tuesday ordered changes to the loan package. If lenders don’t agree to the adjustments, “then I’m prepared to convert the case today,” Judge Walrath said, meaning she would toss Sports Authority out of the relative comfort of chapter 11 bankruptcy and into a chapter 7 liquidation, where a trustee would make the crucial decisions. Lenders are looking over the revised loan deal, which will be taken up again next week at a hearing in the U.S. Bankruptcy Court in Wilmington, Del. Read more. 

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Caesars Entertainment Corp. and its bankrupt operating unit have offered an olive branch to a group of bondholders in a bid to move the unit’s chapter 11 restructuring forward, the Wall Street Journal reported today. Caesars Entertainment Operating Co. says that it and its publicly traded parent, which isn’t in bankruptcy, have offered 85 cents on the dollar to the holders of $502 million in bond debt guaranteed by the CEOC unit’s subsidiaries, the casino companies said yesterday. The settlement offer, which isn’t binding and is subject to further negotiation, would settle a skirmish between the bondholder group and CEOC’s senior creditors. The settlement offer comes as CEOC works to achieve broad creditor support for its $18 billion restructuring, which has been marked by numerous creditor battles.

Sports Authority has abandoned hope of reorganizing and exiting bankruptcy and instead will count on buyers to save parts of its sprawling retail chain, company lawyer Robert Klyman told a judge yesterday, the Wall Street Journal reported. Loaded with more than $1.1 billion in debt, Sports Authority filed for bankruptcy protection in March, saying that it would attempt to trim its operations and restructure, while looking for buyers as an alternate path. Bankruptcy-financing arrangements that won interim approval earlier in the chapter 11 case have allowed lenders to sweep $109 million to pay down their loans, according to the official committee of Sports Authority’s unsecured creditors. That’s been a sore spot for landlords, who believe the timing of the bankruptcy filing, one day after the March rent was due, “had the effect of granting Sports Authority an unsecured interest-free loan of $27 million,” according to David Pollack, lawyer for many of the retailer’s landlords. Sports Authority typically paid about $27 million per month in rent. By filing March 2, the retailer was able to avoid paying the March rent until the end of its case. If there isn’t enough money when Sports Authority’s sales are over, landlords whose premises hosted bankruptcy sales that benefited banks could be forced to take a haircut. Read more. (Subscription required.) 

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West Virginia's environmental authority opposes a plan by bankrupt coal miner Alpha Natural Resources to sell core assets to its hedge fund lenders, saying in a court filing that it could undermine a $1 billion cleanup, Reuters reported on Friday. A string of bankruptcy filings by major U.S. coal companies, including Alpha last August, has raised concern among environmental agencies and the federal government that future mine cleanups may be at risk. The West Virginia Department of Environmental Protection said Alpha's proposed sale of certain mines would strip the company of its "crown jewels," giving it little hope of obtaining its required bonding or performing its cleanup obligations, according to an April 15 filing with the bankruptcy court. The company has agreed to sell various assets to its first-lien lenders, which will pay by forgiving what they are owed, according to court documents. Alpha is seeking court approval of the sale in May and approval for its bankruptcy exit plan in June.

Oil producer Swift Energy Co. said today that it emerged from Chapter 11 bankruptcy, less than four months after filing for creditor protection, Reuters reported. Swift filed for bankruptcy on Dec. 31, joining about 40 other energy companies that entered bankruptcy in 2015 as oil prices plunged. The company entered bankruptcy with an agreement with more than 60 percent of the holders of its unsecured bonds. Swift had said that it planned to exchange those bonds for 96 percent of its stock when it exited bankruptcy. Its shareholders were to get 4 percent of its stock. The company said it has completed its financial reorganization, which was confirmed by the U.S. Bankruptcy Court for the District of Delaware on March 31. Read more. 

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Bankruptcy Judge Stuart M. Bernstein on Friday pushed back an unusual request by SunEdison Inc., a solar-power giant that landed in bankruptcy a day ago, to launch an independent investigation into its dramatic reversal of fortunes, the Wall Street Journal reported on Saturday. Judge Bernstein said that creditors needed more time to organize before he would consider appointing an independent examiner. The U.S. Justice Department and the Securities and Exchange Commission are investigating whether SunEdison management misled the public as the company began to struggle. The examiner request has already drawn fire from bondholders, wary of any efforts by SunEdison to set the scope, cost and duration of the investigation so early in the case. Though the judge shelved SunEdison’s examiner request for now, he approved a number of other requests on Friday aimed at easing the company’s transition into bankruptcy and limiting disruptions while it works out a plan to cut its multibillion debt load. The judge said SunEdison could borrow $90 million under a $300 million bankruptcy loan and signed off on SunEdison’s other requests to ease its transition into bankruptcy while it works out a plan to cut its multibillion debt load.

A New Jersey abortion clinic has filed for bankruptcy after losing a legal battle with several former employees who said they were fired after becoming pregnant, the Wall Street Journal reported today. Pilgrim Medical Center Inc. filed for chapter 11 protection after a judge awarded more than $1 million to three ex-workers who sued the clinic for discrimination. The legal award against Pilgrim Medical Center, which is based in Montclair and employs 22 people, is worth more than half of the $1.8 million in revenue the clinic took in last year, according to documents filed in U.S. Bankruptcy Court in Newark. The clinic is appealing the judgment. The former employees — two medical assistants and an administrative worker — sued in the fall of 2013, accusing supervising physician and clinic owner Nicholas Campanella of punishing them for taking or requesting maternity leave.

Bankruptcy Judge Brendan L. Shannon signed off on New Gulf Resources LLC's restructuring plan, allowing the troubled energy company to wipe roughly $590 million of debt from its balance sheet and to move closer to exiting chapter 11 protection, Dow Jones Daily Bankruptcy Review reported yesterday. The reorganization plan will allow New Gulf, which sought chapter 11 protection late last year, to convert about $590 million in secured and unsecured bonds into equity. New Gulf will issue $135.25 million in new first-lien bonds to its creditors, and some of the new debt will be used to pay down the company's $75 million bankruptcy loan. That loan, from a group of New Gulf's second-lien bondholders, was used to fund the costs of the restructuring and to repay $38 million owed to senior lender MidFirst Bank. The chapter 11 plan will leave New Gulf in the hands of its two bondholder groups. Second-lien bondholders, owed $365 million in principal, will receive about 87.5 percent of New Gulf's new equity and the holders of subordinated paid-in-kind bonds, owed $162 million, will take a roughly 12.5 percent stake. Read more. (Subscription required.) 

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