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West Hartford, Conn.-based Colt Defense could see its bankruptcy reorganization plan voted on by creditors as early as next week, the Hartford Business Journal reported today. The financially troubled gunmaker received approval of its disclosure plan for its second amended plan of reorganization in federal bankruptcy court on Tuesday. The plan, according to a statement from Colt, reflects a consensus reached among its key stakeholders, including a consortium of secured lenders, Morgan Stanley, the official unsecured creditors’ committee appointed in Colt's bankruptcy case, Sciens Capital Management and the landlord at Colt's West Hartford facility.

A U.S. judge on Monday rejected a chapter 11 plan for Boomerang Tube, a pipe maker for the oil industry, in a bankruptcy that shed light on the aggressive tactics of its private equity owner and hedge fund lender, Reuters reported on Tuesday. The bankruptcy pitted the company's owner, billionaire Leonard Blavatnik's Access Industries, and hedge fund lender against its unsecured creditors, who attacked the strategies often used in debt restructurings. In a court filing, the unsecured creditors accused debt investor Black Diamond Capital Management of joining with Access Industries to use bankruptcy to grab control of the company and protect themselves from potential lawsuits. The unsecured creditors convinced Bankruptcy Judge Mary Walrath that Boomerang Tube was undervalued, priced at a historic trough in the oil industry that company serves. They argued that low valuation was used to justify paying them virtually nothing. Read more. 

For more information and insight into bankruptcy valuation, be sure to pick up a copy of ABI’s A Practical Guide to Bankruptcy Valuation. 

Caesars Entertainment Operating Co.'s (CEOC) bid to move forward with its restructuring is premature and unlikely as long as an investigation into major asset transfers remains unresolved, according to the casino company's creditors and the federal government, Dow Jones Daily Bankruptcy Review reported today. In court papers filed on Tuesday, several creditor groups and a Justice Department bankruptcy watchdog urged a judge to deny CEOC's request for a crucial court hearing on its disclosure statement — the document outlining its plan to slash some $10 billion of its $18 billion debt load — to be held by late January. "There is no plausible scenario in which these chapter 11 cases will be ready for a disclosure statement hearing in late January," wrote lawyers for unsecured creditors, who haven't backed CEOC's current restructuring plan. The objections cite an ongoing probe by a court-appointed examiner into various transfers of assets from Caesars to publicly traded parent Caesars Entertainment Corp., which isn't in bankruptcy.

Alpha Natural Resources, one of the largest U.S. coal companies, wants to drop benefits for more than 4,500 miners, spouses and their dependants, Reuters reported yesterday. That step would erase roughly $125 million in obligations for the Virginia-based company as it tries to mollify creditors stung by the company's bankruptcy filing in August, according to court filings. But the move would also erase life insurance and health benefits for about 4,580 non-union retirees, disabled former workers and their families, the company said in its filing with a bankruptcy court in Richmond. The company has asked permission to drop benefits such as "hospital, medical, prescription, surgical and life insurance" at the end of December, according to a court filing that was lodged on Tuesday.

Hercules Offshore plans to emerge from chapter 11 protection today, becoming one of the first embattled oil and gas firm to restructure since the slump began, the Houston Chronicle reported today. The embattled shallow-water rig contractor worked for months with creditors to hammer out an agreement to convert most of its corporate debt into shares. Upon emergence, Hercules’ existing debt will be terminated, new shares will be issued and it will receive funding for a new $450 million term loan. Hercules lost $95.4 million, or 59 cents per diluted share, for the three-month period ending Sept. 30. That’s deeper than the loss of $88.6 million, or 55 cents per diluted share, the company posted the same time last year. Read more.

For more information and analysis of oil and gas bankruptcies, be sure to pick up a copy of ABI’s When Gushers Go Dry: The Essentials of Oil & Gas Bankruptcy. 

Coal producer Walter Energy, Inc. is headed to a bankruptcy auction with an offer from senior lenders to cancel or take on $1.25 billion worth of the company's debts to set a floor price for the competition, Dow Jones Daily Bankruptcy Review reported today. In addition to the $1.25 billion "credit bid," Walter's senior lenders are offering $5.4 million cash for the Alabama-based company. In bankruptcy, lenders can pledge the amount they're owed by a bankrupt company when bidding on a company's assets. In effect, the lenders can swap all or a portion of the face amount of the debt they're owed for an ownership stake.

Coal miner Alpha Natural Resources Inc. is seeking to shed retiree benefits as efforts to come up with a restructuring plan take longer than expected, Dow Jones Daily Bankruptcy Review reported today. Alpha in court papers on Tuesday asked a bankruptcy judge to let it terminate the medical, life insurance and other benefits it provides to about 4,580 non-union retirees or their spouses. The plans also potentially cover 6,670 active, non-union employees, although they wouldn't receive the benefits until their retirement. The benefits slated for termination don't include pensions. Alpha said that it in cutting the benefits by the end of the year, it hopes to escape about $125 million in future obligations. Maintaining the benefits cost the company about $2.7 million last year and about $2.8 million so far this year, court papers show.

After 18 months in bankruptcy, Energy Future Holdings started what it hopes will be the final phase of its reorganization yesterday, pushing for approval of its fourth major restructuring proposal, Bloomberg News reported. The Dallas-based power provider is asking Bankruptcy Judge Christopher Sontchi to sign off on a deal that splits it in half. If Energy Future succeeds, it could mean a solution to problems that grew out of a record, $48 billion leveraged buyout, and end a drawn-out bankruptcy where creditors have already rejected three attempts to reorganize. The deal would create a power distribution unit, including Oncor, Texas’s biggest electric-transmission system, and a power generating unit. Each half would be owned by separate groups of creditors including big name hedge funds specializing in distressed debt. The factions fought over terms for more than a year before reaching a deal with help from Hunt Consolidated, a Dallas-based oil and gas, real estate and power company.

Rare earths supplier Molycorp Inc. said it has filed a joint plan to emerge from chapter 11 protection, Reuters reported yesterday. The plan, which was filed with the U.S. Bankruptcy Court for the District of Delaware yesterday, has proposed an exit of chapter 11 through a stand-alone reorganization or a sale of substantially all of its assets, the company said in a statement. The Greenwood, Colo.-based company said that it has the backing of its largest pre-petition secured creditor and its post-petition lender and investment funds managed by Oaktree Capital Management. The company filed for chapter 11 protection in June, along with its North American subsidiaries to restructure $1.7 billion of debt in its U.S. and Canadian operations.