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.
B456 Systems Inc., the lithium-ion battery maker which received a $249 million U.S. government grant, won court approval on Monday for its bankruptcy plan, Reuters reported yesterday. Bankruptcy Judge Kevin Carey approved the plan under which unsecured creditors of the company, formerly A123 Systems Inc., are expected to recover about 65 cents for each dollar. B456 had earlier won court approval to sell its automotive battery business and related assets to a U.S. unit of China's largest auto parts maker, Wanxiang Group. Wanxiang beat out the only other active bidder, Johnson Controls Inc., in a court-supervised auction for the assets of Waltham, Mass.-based B456. B456 had received a $249 million grant from the U.S. government as part of a clean energy program to build manufacturing facilities in Michigan. About half the money was never released. The company filed for bankruptcy in October due to weaker-than-expected demand for hybrid vehicles and technical problems.
KidsPeace Corp., the owner of a nonprofit psychiatric hospital for teenagers in Pennsylvania, filed for bankruptcy, blaming government spending cuts for its financial woes, Bloomberg News reported yesterday. The company will try to use bankruptcy to reduce its bond debt to $24 million from $51.3 million and to trim pension obligations that may exceed $100 million, according to an affidavit filed yesterday by Chief Executive Officer William R. Isemann. KidsPeace owes creditors more than $100 million and has assets valued at less than $50 million, according to its chapter 11 filing.
The House Judiciary Committee today at 10 a.m. ET will mark up H.R. 982, the “Furthering Asbestos Claim Transparency (FACT) Act of 2013.” The bill, introduced by Rep. Blake Farenthold (R-Texas), aims to amend title 11 of the United States Code to require the public disclosure by trusts established under section 524(g) of such title, of quarterly reports that contain detailed information regarding the receipt and disposition of claims for injuries based on exposure to asbestos. To read a copy of the bill, please click here: http://www.gpo.gov/fdsys/pkg/BILLS-113hr982ih/pdf/BILLS-113hr982ih.pdf
A bankruptcy judge has given final approval to the reorganization plan of failed battery maker A123 Systems Inc., which was the recipient of a $249 million Department of Energy grant, the Associated Press reported yesterday. A court hearing yesterday resolved minor outstanding issues following the sale of most of the company’s assets to the U.S. arm of Chinese auto parts conglomerate Wanxiang Group Corp. for nearly $257 million. One issue was approval of a settlement involving the Waltham, Mass.-based company, now known as B456 Systems, its official creditors' committee, and Milwaukee-based auto parts maker Johnson Controls Inc. The committee had suggested that JCI improperly lobbied to torpedo the sale to Wanxiang after losing out on the bidding. Johnson Controls has agreed to pay $200,000 to the bankruptcy estate, and the committee will drop any claims against JCI.
The trustee liquidating MF Global has sold a collection of the bankrupt broker's CME Group memberships for amounts below recent selling prices, Reuters reported yesterday. Eighteen months after MF Global collapsed, Trustee James Giddens last week sold a variety of memberships owned by the firm that bestow different trading rights on the holders. The firm, which was among the top brokers at CME Group's exchanges, made a $6.3 billion bet on European sovereign debt and went bankrupt after dipping into customer accounts to try to meet margin calls, in violation of industry rules.
Revstone Industries LLC will continue to control its bankruptcy case for at least two more months as it seeks to auction a group of its assets, Dow Jones Newswires reported on Friday. Bankruptcy Judge Brendan Shannon said on Thursday that Revstone will have the exclusive right to file a chapter 11 plan until July 31 and can solicit support for that plan until Sept. 30. Creditors, including General Motors Co. and the U.S. Department of Labor, have requested that the court appoint a chapter 11 trustee to administer the case going forward, arguging that it was Revstone's mismanagement that landed it in bankruptcy to begin with.
The Oreck family is rallying to take back their namesake vacuum-cleaner company from private equity owners in a deal valued at $22 million — a price that founder David Oreck hints is cheaper than what he sold the business for a decade ago, the Wall Street Journal reported on Friday. Oreck has never stately publicly how much he profited from the 2003 sale of his company. But while his three sons lead the charge to buy the company’s 96 retail stores and 250-worker manufacturing plant in Tennessee out of bankruptcy, Oreck pointed out that the value of the business has certainly fallen in recent years. Oreck Corp. filed for chapter 11 protection on May 6, saying that the business has struggled against competitors and that sales have declined since 2010. The company has changed hands since the Oreck family sold it in 2003, and it’s now controlled by Black Diamond Commercial Finance LLC.
An effort by creditors to force defunct investment vehicle TPG Troy into bankruptcy has fallen flat after a judge dismissed the case, citing ongoing litigation over the creditors' claims, Reuters reported yesterday. Tossing out the chapter 7 proceeding on May 9, Bankruptcy Judge Martin Glenn said that there was a "bona fide dispute" over whether TPG Troy, a vehicle of private equity giant TPG Capital, owes the creditors money. The unconventional liquidation was filed on TPG Troy's behalf by a group of hedge fund creditors led by SPQR Capital, which claimed to be owed 111 million euros ($143 million) stemming from TPG Troy's investments in TIM Hellas, a Greek telecommunications company. In February, TPG Troy sought to have the case dismissed, arguing that it could not be in bankruptcy because it had wound down its operations in 2007. It pointed to more than 10 lawsuits filed against it by the creditors over the same alleged debts, saying that the bankruptcy was the latest in a line of creditor attempts at "forum shopping."
Patriot Coal Corp. can pay $6.9 million in bonuses to key employees, a judge said, rejecting union claims that the payments wrongly benefit corporate insiders, Bloomberg News reported yesterday. Bankruptcy Judge Kathy A. Surratt-States yesterday granted the company’s request to pay 274 people under two bonus plans. Patriot said that the money would give managers an incentive to improve the company’s performance and stay through its chapter 11 reorganization. The United Mine Workers of America, which represents 42 percent of Patriot’s workforce, objected, calling the payments “massive bonuses to corporate insiders” at a time when the company is seeking concessions from regular employees and claiming it faces a liquidity crisis. The company’s top 35 officers, who make up 13 percent of the bonus plan participants by number, will get 42 percent of one payment plan by amount and 61 percent of the other, the union said.