%1

Months after its spinoff from Hertz Global Holdings Inc., Advantage Rent a Car is asking federal regulators to approve its sale to a new owner, the Wall Street Journal reported today. The Federal Trade Commission yesterday began seeking public comment on Catalyst Capital Group Inc.’s bid to acquire Advantage, the fourth-largest independent U.S. car-rental chain, out of chapter 11. A bankruptcy judge approved the deal last week, although a rival bidder is appealing, and the FTC must still give its blessing.

Cengage Learning Inc.'s efforts to line up $2 billion in bankruptcy-exit financing are facing headwinds from the committee representing its unsecured creditors, which says the financing is "premature and unnecessary," the Wall Street Journal reported today. In court documents filed on Monday, the unsecured creditors' committee in the textbook publisher’s chapter 11 case said that it doesn’t support the payment of loan fees in connection with a bankruptcy-exit plan it believes “cannot be confirmed, or at best, has a real risk of not being confirmed.” The committee has argued that it doesn’t believe Cengage’s current plan for exiting chapter 11 protection can be approved by the court. The company and its creditors have been in mediation, with the goal of resolving disagreements prior to Feb. 24, when Judge Elizabeth Stong is slated to consider confirmation of the plan, putting the company on track to emerge from bankruptcy in March.

Defunct telecoms equipment maker Nortel Networks Inc. received court approval yesterday for a $75 million deal it called a "significant milestone" in ending its five-year bankruptcy, Reuters reported yesterday. In return for the payment, insolvent Nortel affiliates in Europe will drop claims seeking more than $3 billion from Nortel's U.S. bankruptcy proceeding. Nortel's global business, once worth $250 billion with 93,000 employees, collapsed in January 2009. Its businesses and patents were quickly auctioned off, raising $7.5 billion. Yesterday's settlement resolves some of the biggest claims against the U.S. estate, including that it allegedly short-changed a pension in Britain. The agreement does not affect a looming fight over how to divide the billions in cash among insolvency and bankruptcy proceedings in different countries.

Going-out-of-business sales could begin as early as Thursday at Loehmann's Holdings Inc.'s 39 designer discount retailers after the bankruptcy court's approval yesterday of a sale worth $16.4 million, Dow Jones Daily Bankruptcy Review reported today. Bankruptcy Judge Martin Glenn yesterday approved the sale of two groups of assets and scheduled for Friday a hearing on a third sale worth an additional $7.5 million. Loehmann's auction, held on Friday, overall garnered $23.9 million for the company's assets.

A section of LightSquared Inc. lenders are opposing the company's decision to seek a new financing arrangement as part of its plan to exit bankruptcy, Reuters reported today. LightSquared in December proposed a new bankruptcy exit plan with financing from Fortress Investment Group and other backers, as the U.S. wireless communications company seeks to avoid a sale to highest bidder Dish Network Corp. The new plan replaced one based on an auction of the company's assets. LightSquared scrapped that sale after Dish emerged as the only qualified bidder, with a $2.2 billion offer and terms that LightSquared found unappealing. LightSquared had asked to be allowed to implement the new plan without going back to creditors to get their approval, saying that the latest deal increases the recovery for creditors. However, lenders including US Bank and MAST Capital Management said yesterday that the new arrangement violates an earlier deal, which prohibited LightSquared from seeking alternative financing unless the creditors were first paid in full.

Nortel Networks Corp. tomorrow will ask a bankruptcy court to sign off on what it called a "milestone" in its long-running liquidation: a settlement with key creditors in a fight over billions of dollars, the Wall Street Journal reported on Saturday. In December, Nortel's U.S. unit reached a deal to resolve a bitter battle over how much it owes its European creditors and U.K. retirees. Nortel would pay $75 million under the settlement, which would also allow the company to shake nearly $2 billion of claims filed in its chapter 11 case for a fraction of the amount asserted by representatives of French creditors, British pensioners and other European creditors, court papers say.

Hybrid Tech Holdings LLC has bumped up its offer for Fisker Automotive Inc. in a bid to ward off competition for the hybrid-car company from a unit of China's Wanxiang Group, the Wall Street Journal reported on Friday. In advance of a courtroom showdown over Fisker, Hybrid Tech increased by $1 million the cash it is offering creditors to $26 million and proposed splitting with them the proceeds from the sale of a former General Motors plant in Delaware, a facility some estimates say could be worth as much as $50 million. Originally slated for Friday, the court session was pushed back to Jan. 10 in the wake of a rapid-fire series of developments that brought a new contender to the field, amid creditor questions about what went wrong at the maker of luxury hybrid vehicles.

U.S. prosecutors and regulators are expected to announce this week that JPMorgan Chase & Co. will pay slightly more than $2 billion in penalties for alleged failures to warn about Bernard L. Madoff's massive fraud, the Wall Street Journal reported today. The federal actions, which are expected to include a deferred-prosecution agreement with Manhattan U.S. Attorney Preet Bharara, could be announced as early as tomorrow. The bulk of the fines are expected to be routed to victims of Madoff, who pleaded guilty to charges he ran a decades-long Ponzi scheme that bilked investors out of billions of dollars. Penalties paid to the Justice Department are expected to form the largest chunk of the total — an amount greater than $1.5 billion.

The Philadelphia Inquirer is being pushed back to the auction block by warring owners who can't agree on how to run the newspaper operation or how to break the impasse at the top of the company, Dow Jones Daily Bankruptcy Review reported today. New Jersey political power broker George Norcross III and ally Joseph Buckelew, who own 58 percent of the company that owns the Inquirer, Philadelphia Daily News and the associated digital news operation, have turned to a Delaware court for aid, saying that they are countering a move by minority owner Lewis Katz, a parking lot and sports mogul, that "presents a real risk of another bankruptcy and additional job losses" for the publications.

U.S. Trustee Roberta A. DeAngelis is objecting to Green Field Energy Services Inc.'s proposed employee bonuses, advising the court to intervene, Dow Jones Newswires reported yesterday. DeAngelis said in a court filing yesterday that the bonus plan — notable details of which, including the amount, have been redacted — was structured to entice employees to remain with the company through its bankruptcy instead of rewarding them for performance. "Despite the label of the bonus plan, the bonus plan is structured to entice the debtors' insiders to stay with the companies and do their jobs through the conclusion of the restructuring process, rather than entice the insiders to perform at a high level to achieve significant benchmarks," she said.