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Bankruptcy Judge Allan L. Gropper on Friday approved an investor group's $275 million bid to sponsor a plan to bring the newly resurgent K-V Pharmaceutical Co. out of bankruptcy after "peace broke out" between two warring factions of bidders, Dow Jones Daily Bankruptcy Review reported today. The settlement, announced in court Friday afternoon, brings to an end months of legal sparring between the investor group—Greywolf Capital, Susquehanna International Group, Deutsche Bank Securities Inc. and Kingdon Associates—and a separate group of lenders led by Silver Point Capital. The investor group has agreed to backstop a $238 million rights offering that will form the backbone of K-V Pharmaceutical's chapter 11 plan.

Micron Technologies Inc.'s planned acquisition of bankrupt Japanese chipmaker Elpida Memory Inc. appeared to move closer to completion on Friday after a key deadline passed without a legal challenge, Reuters reported on Friday. U.S. creditors had until 4 p.m. on Friday to object to the request by Elpida to have a bankruptcy issue orders that would enforce its Japanese restructuring, according to court records. At the center of the restructuring is the proposed sale to Micron for 200 billion yen (about $2.1 billion), which will create the world's second-largest maker of memory chips.

Lehman Brothers' defunct brokerage told an appeals court yesterday that it was entitled to billions of dollars in cash it says was wrongly included in its 2008 sale to Barclays Plc, Reuters reported yesterday. The arguments in federal appeals court in New York renewed a court battle with huge implications for the brokerage's creditors, including Lehman affiliates and hedge funds. The dispute has its roots in the hectic sale of the brokerage's assets to Barclays in the days following the $639 billion bankruptcy of parent company Lehman Brothers Holdings Inc. in September of 2008. The brokerage contends the $250 million deal did not include the brokerage's cash assets. But Barclays says otherwise, relying on a clarification letter signed after the deal was approved.

Video game maker Atari Inc. is seeking court approval for the sale of all its assets as it works its way out of bankruptcy protection, Reuters reported yesterday. The company said on Tuesday that it tried looking for a buyer with the help of its investment banker Perella Weinberg Partners, but was unable to find a stalking-horse bid acceptable to it. Atari has set a minimum bid of $15 million for the Atari brand. The company received a $5 million debtor-in-possession financing from Alden Global Value Recovery Master Fund LP.

Charlie Ergen, chairman of satellite-TV provider Dish Network Corp., made a $2 billion bid for radio frequencies from LightSquared Inc., the bankrupt wireless-broadband company owned by Philip Falcone’s hedge-fund firm, Bloomberg News reported yesterday. Ergen has offered to buy the spectrum even though the Federal Communications Commission has yet to approve its use. Reston, Va.-based LightSquared filed for bankruptcy last year after regulators blocked approval to build its network on concern it would interfere with global-positioning system signals. LightSquared would use the proceeds from selling its airwaves to pay off secured debt, according to the people. The company has until May 31 to accept the offer, which was made May 15.

Without clear instructions from the Bankruptcy Code on what to do with the unclaimed money that is too small to distribute among a liquidated company’s creditors, ABI is encouraging members to donate the money to the organization’s own nonprofit endowment fund, the Wall Street Journal reported today. “Rather than having it [turn over] to the state, why not recycle it into the bankruptcy community?” said ABI executive director Sam Gerdano. ABI has a 131-word passage posted on its website that bankruptcy attorneys can copy and paste into creditor payout plans to direct the money to the fund, which pays for scholarship and bankruptcy research. The trade group’s initiative comes at a time when many restructuring professionals are confused over what to do with unexpected leftover money in a liquidating chapter 11 bankruptcy case. That money can come from uncashed creditor checks, tax rebates or returned utility deposits. ABI’s endowment fund pays for bankruptcy-related research into topics such as the high fees in corporate bankruptcy cases or the cost of bankruptcy for individuals. “In lieu of people throwing around anecdotes or impressions or first-hand experiences, we provided data-supported conclusions,” said University of Maine Law Professor and Bankruptcy Attorney Lois Lupica.

For more information about donating unclaimed liquidation funds to the ABI Endowment Fund, please click here: http://endowment.abi.org/unclaimed

Secured lenders led by Credit Suisse AG have been declared winners of an auction for the oil and gas drilling assets of ATP Oil & Gas Corp. with an offer of $690.8 million, Dow Jones Daily Bankruptcy Review reported today. Most of the purchase price will be in the form of canceled debt. Credit Suisse leads a syndicate of investors that have been keeping ATP going in bankruptcy, providing funds to support its activities in the Gulf of Mexico.

Republic Airways Holdings said yesterday that it still plans to shed its Frontier unit by June or July, depending on whether a sales agreement is reached, Reuters reported yesterday. Indianapolis-based Republic, which operates regional carriers Republic Airlines and Chautauqua Airlines, has been looking to divest itself of Frontier since late 2011. It had bought Frontier out of bankruptcy in 2009. The Wall Street Journal reported in early April that two investment firms, Indigo Partners LLC in Phoenix, and Anchorage Capital Group LLC in New York, were competing to buy Frontier. Talks with Republic were at an early stage and could fall apart, the newspaper reported.

ATP Oil & Gas Corp. lender Credit Suisse AG plans to bid on the company's deep-water drilling assets at an auction next week, Dow Jones Daily Bankruptcy Review reported today. In total, ATP owes its top-ranking lenders, including Credit Suisse, $600 million. ATP won court approval in February to sell leasehold and other working interests in 23 deep-water areas off the shores of Texas and Louisiana, including related production facilities, pipelines, machinery and equipment.

For more insight on oil and gas company bankruptcies, be sure to pick up a copy of ABI's When Gushers Go Dry: The Essentials of Oil & Gas Bankruptcy from the ABI Bookstore. Please click here for more information.

A bankruptcy judge has approved the sale of a 7 percent stake in the Sacramento Kings to Seattle-based hedge fund manager Chris Hansen, KCRA.com reported yesterday. Last month, Hansen filed a motion with the federal bankruptcy court in Sacramento, asking to purchase the share of the basketball team that belonged to former minority owner Bob Cook. Cook filed for bankruptcy, and his share was being held by a trustee. In court on Tuesday, it was disclosed that Hansen put down a $1.5 million nonrefundable deposit for the 7 percent ownership. The minority sale will still need to be approved by the NBA Board of Governors. If the NBA rejects the offer, Hansen would get his deposit back.