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Shareholders of Horsehead Holding, who stand to recover nothing under a creditor-proposed reorganization plan, say that the bankrupt zinc producer’s assets are worth about $500 million more than the creditors say they are, the Pittsburgh Post-Gazette reported today. If their estimate is accurate, they would be able to recoup part of their investment — something that does not happen in most bankruptcies. A court-appointed committee representing shareholders alleges that the creditor group leading the reorganization of Robinson-based Horsehead is deliberately underestimating the value of the company in order to take control at a bargain price. Horsehead declared bankruptcy Feb. 2, plagued by depressed metals prices as well as massive equipment problems and cost overruns at its zinc refinery in Mooresboro, N.C. The company listed liabilities of $544.7 million and assets of $1 billion in papers filed in federal bankruptcy court in Wilmington, Del. Since then, the creditor group leading the reorganization said the company’s value has deteriorated to between $255 million to $305 million. Under their plan, they would exchange their debt for controlling interest in the stock of the reorganized company. Existing Horsehead shareholders would get nothing. Read more. 

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Sabine Oil & Gas Corp. and Samson Resources Corp., energy producers with a combined debt of nearly $8 billion, are facing showdowns over plans to exit bankruptcy as junior creditors are demanding larger repayments, Reuters reported yesterday. Sabine and Samson were among the biggest bankruptcies in the energy sector last year, when energy prices began falling sharply. Both proposed to exit chapter 11 by swapping control of the company to their lenders in return for eliminating billions of dollars of debt. Both bankruptcy exit plans have run into objections from official committees of unsecured creditors. Sabine's creditors argued in court papers filed on Wednesday that the company improperly valued lenders' collateral, which led to a plan that is unfair to unsecured creditors. While Sabine has proposed giving unsecured creditors equity worth $6.8 million in a reorganized Sabine, the unsecured creditors argued they could be entitled to $268 million. The company's unsecured creditors are owed $1.4 billion. Samson's unsecured creditors made similar arguments in court papers filed on Tuesday in which they asked the U.S. Bankruptcy Court in Delaware to take the relatively rare step of ending the company's exclusive right to propose a plan of reorganization. The Samson committee proposed its own plan in which certain unsecured creditors would end up controlling the company through a debt-for-equity swap and a rights offering for shares in the reorganized company. Read more. 

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The figure of $2.4 trillion is the amount that people around the world claim they lost when Mt. Gox, the Tokyo-based virtual currency exchange, collapsed into bankruptcy in 2014, after huge, unexplained losses of the volatile digital currency Bitcoin, the New York Times reported today. As with most of the people who lost money with Bernard L. Madoff, the investment manager who was convicted of running a Ponzi scheme, most of those who put their Bitcoin in Mt. Gox will be disappointed: The Japanese trustee overseeing the case said yesterday that only $91 million in assets has been tracked down to distribute to claimants — a small portion of the more than $500 million in assets that Mt. Gox claimed it had in the weeks before it went bankrupt in February 2014, and a tiny portion of the amount that claimants have requested. Bitcoin experts and law enforcement officials have spent over two years trying to figure out how hundreds of thousands of Bitcoins disappeared from the Mt. Gox exchange. There have been lots of conspiracy theories but few solid answers. The amount that claimants have requested from the Mt. Gox bankruptcy estate is extremely high, given that all the Bitcoins in the world today are worth about $7 billion, or 0.3 percent of the $2.4 trillion being claimed.

Verso Corp. has asked a bankruptcy judge to step in and decide whether the town of Jay, Maine, should hand back as much as $11.4 million in taxes assessed during the past three years, the Bangor (Maine) Daily News reported today. The company’s request comes as Verso has three appeals of its most recent tax bills pending before a state review board and local review boards. The town plans to argue the disputes should stay at the state and local levels. A hearing on Verso’s request is scheduled for today in U.S. Bankruptcy Court in Delaware. The company’s 2013 tax year appeal is set for a hearing May 9 and 10 before the Maine Board of Property Tax Review in Augusta, Maine. Read more.

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