Bankruptcy Judge Christopher Sontchi signed off on the sale of consulting firm Monitor Co. Group LP's assets to a subsidiary of Deloitte Touche, Dow Jones DBR Small Cap reported today. Deloitte Touche Tohmatsu Ltd. is paying $116.2 million for Monitor, which was founded by a pair of Harvard Business School professors.
Losers at the bankruptcy auction for the Tully's coffee shops are protesting TV actor Patrick Dempsey's winning $9.1 million offer for the struggling West Coast chain's 47 locations, arguing that a competing bid from Starbucks Corp. and another group offered more money, Dow Jones DBR Small Cap reported today. As the 13-hour auction drew to a close, Starbucks executives teamed up with another group to offer more than $10.5 million for the chain, which would have enabled the coffee giant to take over 13 Tully's locations and to sell coffee within Boeing Co .'s manufacturing plants.
Eastman Kodak Co.'s proposed $525 million sale of its digital imaging patents to Intellectual Ventures and RPX Corp received approval from Bankruptcy Judge Alan Gropper on Friday, bringing the photography company a step closer to exiting chapter 11, Reuters reported on Friday. The price is a fraction of the more than $2 billion Kodak had hoped to fetch for the patents when it filed for bankruptcy in January 2012. However, it allows the company to proceed with a plan to secure $830 million in financing and exit bankruptcy in the first half of this year. Intellectual Ventures and RPX lead a consortium of some of the world's biggest technology companies, including Adobe Systems Inc., Amazon.com Inc., Apple Inc. and Fujifilm Holdings Corp. The deal, announced in December, allows for the licensing of patents, settlement of patent-related legal claims, and the assumption of a cross-licensing agreement between Kodak and Fuji.
Flowers Foods Inc. on Friday said that it has agreed to buy Wonder and other well-known bread brands from Hostess Brands Inc. for $390 million, as part of the latter company's bankruptcy reorganization, Reuters reported on Friday. The Thomasville, Ga.-based company said that it agreed to pay $360 million for the Wonder, Butternut, Home Pride, Merita and Nature's Pride brands, as well as 20 bakeries and 38 depots. It also entered a second contract where it agreed to pay $30 million for the Beefsteak brand. Flowers already owns brands such as Cobblestone Mill, Nature's Own and Tastykake. It said it expects the purchases to add to earnings in 2013, and that it would finance them with cash on hand plus debt.
American Airlines parent AMR Corp. asked a court on Friday for more time to file a restructuring plan as part of its exit from bankruptcy, Reuters reported. American wants to submit the plan on April 1, twenty days later than the current March 11 deadline, the company said in a court filing. It would be the fifth extension granted to the company since it filed for bankruptcy protection in November 2011. The case is AMR Corp., 11-15463, U.S. Bankruptcy Court, Southern District of New York.
Penson Worldwide Inc., once a securities clearing broker that has since divested most of its operations, filed for chapter 11 protection, Reuters reported on Friday. Last year the company sold its futures division to Knight Capital Group Inc. and its broker-deal subsidiary to Apex Clearing Corp. The company said in court filings that it was unable to successfully streamline is business after the asset sales. It was also dogged by questions from the Securities and Exchange Commission about its accounting and a class action lawsuit by shareholders. The company listed both assets and liabilities of between $100 million and $500 million.
A plan by Residential Capital LLC, the bankrupt mortgage lending unit of Ally Financial Inc., to pay up to $33.4 million in annual bonuses to about 3,000 of the company's 3,926 employees drew an objection from U.S. Trustee Tracy Hope Davis, Reuters reported on Friday. Davis said in court papers that the annual incentive plan could not be characterized as being part of ResCap's ordinary course of business since it entered bankruptcy protection with the intention of selling its servicing platform and loans. The plan includes senior executives other than the company's chief executive, president and chief capital markets officer. In August, a federal bankruptcy judge rejected the company's plan to pay incentive bonuses to 17 senior executives, saying that the payouts were aimed at retaining them, not to compensate for increased responsibilities or performance, as required by bankruptcy law. An amended bonus plan, based on more ambitious performance metrics, was approved in October.
A key financial regulator has interviewed the executive team that ran Peregrine Financial Group Inc. in an effort to improve its oversight of the industry, which was heavily criticized in the wake of the broker's collapse last July, the Wall Street Journal reported on Saturday. Investigators working on behalf of the National Futures Association (NFA) talked with most of Peregrine's senior ranks—including jailed founder and Chief Executive Russell Wasendorf Sr.—over the past month. The Chicago-based NFA drew scrutiny from investors and policy makers after the revelations of fraud at Peregrine. Directors of the industry-funded agency, which federal futures market regulators depend upon for day-to-day policing of brokers, last summer ordered an external review of its practices while putting on hold potential management changes and bonus payments to top officials.
Bondholders, suppliers, governments and former employees from around the globe hold $20 billion in claims based on different insolvency laws and are competing for Nortel's last remaining asset - $9 billion in cash, Reuters reported on Friday. Ontario Chief Justice Warren Winkler, who has spent the past few months analyzing proposals, begins a week of talks today intended to find common ground. Winkler has called the case "one of the most complex transnational legal proceedings in history." Failure of the mediation would mean years of litigation, with the possibility that parallel legal fights in different countries could reach inconsistent outcomes, according to Winkler, who was appointed to mediate by the U.S. and Canadian courts. John Penn, a bankruptcy attorney who is not involved in the case, said that the mediation is comparable to a football playoff between the New England Patriots, the Hamilton (Ontario) Tiger-Cats, Manchester United and Australia's Sydney Swans. "Each calls it 'football' but they all do something that's quite different," said Penn, of Haynes and Boone in Fort Worth, Texas. The complex disputes stem from Nortel's former might as a global telecom empire with a web of intercompany finances and a workforce that once stood at 93,000.
The U.S. government has objected to a bankruptcy reorganization plan that calls for the sale of MSR Resort hotel group to a Singapore sovereign wealth fund, saying that it is an attempt to dodge taxes, Reuters reported yesterday. The MSR Resort group's plan to sell itself to the Government of Singapore Investment Corp. creates tax liabilities of $331 million with no recourse for the Internal Revenue Service (IRS) to recover them, Preet Bharara, U.S. attorney for the Southern District of New York, said in his objection filed on Wednesday. Bharara also objected to MSR seeking an injunction that bars the government from reviewing the tax consequences of the plan.