The sale of men's suit maker HMX Group for $70.1 million to Authentic Brands Group , which is owned by private equity firm Leonard Green & Partners LP , received bankruptcy court approval on Wednesday, Dow Jones DBR Small Cap reported today. The deal is expected to close Friday, according to Leonard, Street and Deinard's Robert Kugler, who represents the committee of unsecured creditors in the case.
San Bernardino, Calif., may become the first bankrupt city to force the biggest U.S. public pension fund to wait in line with other creditors while it struggles to regain solvency, Bloomberg News reported today. San Bernardino and the California Public Employees’ Retirement System (Calpers) will ask a judge today to decide the legality of the city's decision to defer about $13 million in pension payments for policemen, firefighters and street cleaners. Calpers argues that San Bernardino cannot defer its payments to the fund, which uses the money to help cover the monthly pensions of retired city employees. Allowing the deferral would be unfair because Calpers may still be required to pay those retirees $3.75 million a month, the fund said in court papers filed Dec. 17.
To learn more about issues in chapter 9, be sure to pick up the latest ABI publication, Municipalities in Peril: The ABI Guide to Chapter 9, Second Edition, now up for pre-order in ABI's Bookstore.
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Videogame maker THQ Inc. said yesterday that it filed for chapter 11 protection and entered into an agreement with private investment firm Clearlake Capital Group for a potential sale of its assets, Reuters reported yesterday. The assets to be sold include THQ's four studios and games in development. THQ also said that it has commitments from Wells Fargo & Co and Clearlake for financing of approximately $37.5 million, subject to approval from court.
Journal Register Co. wants to keep control of its bankruptcy case for an extra four months, saying that it needs the extension to work through its sale process, Dow Jones DBR Small Cap reported today. The publisher behind local newspapers such as the New Haven Register is asking a judge to bar creditors from introducing rival bankruptcy-exit plans in its chapter 11 case through May 3, 2013. Journal Register also wants permission to solicit votes for its plan through July 2.
Members of ABI's Chapter 11 Reform Commission said yesterday pointed to labor and benefits being key issues likely to surface during a host of public hearings beginning early next year, Reuters reported. "We'll be hearing from both labor and management about the way the bankruptcy code treats collective bargaining agreements, pension issues and the like," said Commission Co-Chair Robert Keach Bernstein Shur Sawyer & Nelson on an ABI media teleconference. In the handful of hearings so far, the commission has heard largely from lenders, many of whom have expressed concern that the commission would look to limit the use of secured credit. Commission members have said they are not looking to curb the use of secured credit so much as improve its transparency. The commission will also consider changes to rules that exempt derivatives contracts from certain bankruptcy rules and the effects on bankrupt retailers of a 2005 law that changed rules on treatment of leases in bankruptcy. About six or seven hearings will be held throughout the country next year. Read more: http://www.reuters.com/article/2012/12/03/bankruptcy-commission-idUSL1E…
To listen to the ABI media teleconference, please click here:
http://news.abi.org/educatonal-brief/teleconference-to-look-at-chapter-…
American Airlines' bankrupt parent has asked a judge to extend by six weeks, through March 11, the period in which it has the exclusive right to propose a plan to exit bankruptcy, Reuters reported on Friday. The current exclusive window is set to end on Jan. 28. AMR Corp filed for bankruptcy a year ago in hopes of reducing labor costs and returning to profitability. Its smaller competitor, US Airways Group Inc, is making a push to acquire it out of bankruptcy. AMR said earlier this year it would prefer to exit as a standalone company, but is discussing merger options, including with US Airways.
More than six months have elapsed since Dewey & LeBoeuf LLP sought chapter 11 bankruptcy protection amid an exodus of partners, accusations of mismanagement and lenders' refusal to extend credit to the debt-laden law firm, but the finger-pointing over who is to blame for Dewey's demise continues, the Wall Street Journal reported yesterday. A hearing yesterday featured a motion by Dewey's unsecured creditors seeking standing to pursue mismanagement claims against the firm's three top managers, former chairman Steven Davis, former executive director Stephen DiCarmine and former chief financial officer Joel Sanders. The intent is to recoup money from a $50 million insurance policy held by the firm. While Davis, who has yet to appear in court, does not oppose that motion, he "denies that he engaged in any wrongdoing and disputes the allegations," according to a limited objection filed last week by his lawyers.
Bankruptcy Judge Robert D. Drain yesterday gave final approval to Hostess Brands' plans to wind itself down and sell famous brands like Twinkies to help pay creditors, the New York Times DealBook blog reported yesterday. Judge Drain also approved a plan to pay out up to $1.8 million in bonuses to 19 senior executives. He did so over criticism that the payouts were excessive, noting that none of the executives were in running the company when it filed for bankruptcy protection in January for the second time in a decade. Judge Drain's approval formally sets up what increasingly looks like a crowded auction for Hostess's stable of well-known baked goods, from Twinkies to Ho Hos and Ding Dongs to Drake's cakes. Read more: http://dealbook.nytimes.com/2012/11/29/interest-in-hostess-brands-comin…
In related news, nearly 110 potential bidders have contacted the Hostess about bidding for at least part of its business, and 70 had enough interest to sign confidentiality agreements, Reuters reported yesterday. Joshua Scherer of Perella Weinberg, who was hired by Hostess to sell its assets, said that six potential bidders have hired large investment banks to help them. He said the liquidation could raise $1 billion. Read more: http://www.reuters.com/article/2012/11/29/hostess-bankruptcy-liduidatio…
Denham Capital Management-backed biomass company Big Island Carbon LLC, which sought to produce energy from macadamia nutshells in Hawaii, has filed for chapter 7 to liquidate its assets, Dow Jones DBR Small Cap reported today. The company claimed $16.8 million in debt, composed of $11.4 million in secured debt owed to Kona Investment Holdings, a $5 million secured loan from Synergy Bank and $395,000 in unsecured claims. It has $23.5 million in assets, according to court documents, including $22.7 million worth of equipment used to process the shells.
