Overseas Shipholding Group Inc. exited chapter 11 protection yesterday, less than two years after filing for bankruptcy to restructure its finances under the weight of a large tax liability, Dow Jones Daily Bankruptcy Review reported today. Bankruptcy Judge Peter Walsh cleared the way for Overseas Shipholding's bankruptcy exit at a July 18 hearing, and a deadline to appeal Judge Walsh's decision passed Aug. 1. The company's bankruptcy plan repays in full senior lenders owed $1.5 billion and gives bondholders cash, new debt or reinstated loans.
The Adelphia Recovery Trust (ART) has filed a motion in bankruptcy court seeking approval to extend the term of the ART through Dec. 31, 2016, PRNewswire reported yesterday. Adelphia's reorganization plan established an initial termination date of Feb. 14, 2012, and was eventually extended to Dec. 31, 2014, with the bankruptcy court's approval. Although the trust has resolved several causes of action and distributed $275 million to date to interest-holders, the FPL cause of action has not been and is not likely to be resolved by Dec. 31, 2014, when the ART's term expires.
Drybulk shipper Genco Shipping emerged from chapter 11 protection, the Associated Press reported yesterday. The company says it reduced its debt by $1.2 billion while eliminating $192.8 million in amortization payments and $40 million in annual interest payments. Genco also says that it got $100 million in new capital through a rights offering. Genco Shipping & Trading Ltd. filed for bankruptcy protection in April, saying it had $1.3 billion in debt and needed to reduce debt and restructure its business.
Textbook publisher Cengage Learning has ended its nine-month bankruptcy, emerging from chapter 11 after reducing its $5.8 billion debt by more than two-thirds, Reuters reported yesterday. Stamford, Conn.-based Cengage said that it cut $4 billion in debt and secured $1.75 billion in new loans to fund its bankruptcy exit. Created in a leveraged buyout led by Apax Partners in 2007, Cengage had been in bankruptcy since July, when it filed with a pre-packaged restructuring in place. Apax, along with Omers Capital Partners, bought Cengage for $7.75 billion from Thomson Reuters Corp., the parent of Reuters. Thomson asserted a $1.46 million unsecured claim against Cengage in its bankruptcy, but Cengage assumed the contract on which the claim was based, meaning Thomson will receive full payment, Cengage said.
LightSquared Inc., Philip Falcone’s bankrupt wireless-spectrum company, will get court permission to have creditors vote on four competing plans to restructure the company, Bloomberg News reported yesterday. U.S. Bankruptcy Judge Shelley Chapman in Manhattan said that she would approve all four disclosure statements, which describe the reorganization plans, once final versions are submitted. The plans come from the company, an ad-hoc group of lenders, Falcone’s Harbinger Capital Partners LLC, and U.S. Bank NA and Mast Capital Management LLC. Creditors will vote by Dec. 5, according to court papers. LightSquared’s plan proposes a sale of almost all of its assets at auction while the company seeks approval from the Federal Communications Commission to use its airwaves. The lender group, which holds $1.4 billion of the $1.7 billion in debt of LightSquared’s LP unit, has a similar plan calling for a sale. A unit of Charlie Ergen’s Dish Network Corp. (DISH) would make a stalking-horse bid of $2.2 billion. Harbinger’s plan would reorganize LightSquared without a sale. The case is In re LightSquared Inc., 12-bk-12080, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
Fortress Investment Group LLC's GateHouse Media Inc., which will be taking over management of the former Dow Jones Local Media Group publications, said that it plans to restructure its $1.2 billion debt load through a prepackaged chapter 11 bankruptcy filing, The Wall Street Journal reported yesterday. GateHouse, which operates a struggling chain of local newspapers and publications in smaller markets, has been working toward a restructuring for months. Fortress affiliate Newcastle Investment Corp., which owns about 52% of GateHouse's debt, earlier this week acquired Dow Jones Local Media Group from News Corp. The company said yesterday that it paid $87 million for Dow Jones business and tagged GateHouse to run the string of 33 local newspapers. The plans are to combine the Dow Jones Local Media string of publications with GateHouse's existing holdings into a new company, to be called New Media, Newcastle Chairman Wes Edens said. Concurrently with the bankruptcy, Newcastle will ask for permission from the Securities and Exchange Commission to spin out the combined and revamped GateHouse and Dow Jones Local Media Group business into the new company.
A Manhattan bankruptcy judge has approved a plan for Eastman Kodak to emerge from chapter 11 as early as Sept. 3, ABC News reported yesterday. The new company will not bear much resemblance to the film-and-camera company of yesteryear, though, as it will not be making or selling any products to consumers. Hon. Allan Gropper, in approving the plan, called it necessary to Kodak's regaining what he called "its position in the pantheon of American business." Kodak said in a statement that it is transforming itself into a seller of digital printing services to other businesses. The company’s traditional consumer products will be made by another entity, which is owned by a U.K. pension fund and yet to be named. In order to settle $3 billion worth of pension obligations to its former workers in the U.K., Kodak is selling its consumer film and camera business to the workers' pension fund. Kodak’s spokesperson said that the fund has not yet settled on a name but that it has the legal right to continue using the name Kodak.
The U.S. Bankruptcy Court for the District of Arizona granted conditional approval to Swift Air of its proposed second amended disclosure statement and authorized the company to immediately begin the process of soliciting creditor acceptances of its proposed plan of reorganization, PRNewswire reported today. The bankruptcy court has also scheduled a confirmation hearing on the company's reorganization plan for Sept. 30. The creditors' committee in the company's chapter 11 case has given its full support and endorsement of the company's plan and strategies for emergence from bankruptcy, anticipated to occur by mid-October. In addition, the court has authorized the company to secure additional Boeing 737 aircraft to support s current clientele and to serve new customers with its planned diversification into the ACMI (aircraft, crew, maintenance and insurance) market.
Eastman Kodak Co. won court approval yesterday of its plan to exit bankruptcy as a commercial printing company that sells nothing to consumers, Bloomberg reported today. The plan, which cuts about $4.1 billion of debt, was approved by Hon. Allan Gropper and affirms Kodak’s move away from cameras, film sales and consumer photo developing, which had made the company a household name, to focus instead on printing technology for corporate customers. Kodak “is in many ways a new operation” after shedding its best-known businesses, Judge Gropper said. “This is on a day when many are losing retirement benefits, when many are finding that their recovery as a creditor is just a minute fraction” of what they expected. Secured claims will be paid in full under the plan, while shareholders will receive nothing. Unsecured creditors with estimated claims of as much as $2.2 billion will be paid 4 to 5 cents on the dollar. In court papers, Kodak called the plan a “comprehensive compromise” between the company and its creditors. The bankruptcy case is In re Eastman Kodak Co., 12-bk-10202, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
Revel, a brand new but struggling Atlantic City casino, has formally emerged from bankruptcy, the Associated Press reported yesterday. The pre-packaged chapter 11 filing wiped out $1.2 billion of the casino’s $1.5 billion in debt by giving lenders an 82 percent ownership stake. Revel posted a $149 million operating loss from its April 2, 2012, opening through the end of March 2013.
