Private mortgage insurer PMI Group Inc. has emerged from chapter 11 protection, the Associated Press reported yesterday. The company filed for bankruptcy protection in November 2011 after two of its subsidiaries were seized by regulators in Arizona. The regulators seized PMI Group's main subsidiaries in the state, PMI Mortgage Insurance Co. and PMI Insurance Co., because the companies did not have enough money on hand to meet state requirements. PMI Group suffered heavy losses once the housing market bubble popped.
Tesco Plc’s Fresh & Easy Neighborhood Market Inc. filed for bankruptcy so it can sell itself at auction with an affiliate of billionaire Ron Burkle’s Yucaipa Cos. as the lead bidder, Bloomberg News reported yesterday. Fresh & Easy yesterday listed debt of as much as $1 billion and assets of as much as $500 million in a court filing. Under the proposed deal, a Tesco affiliate would loan the Yucaipa affiliate $120 million to help fund the takeover. Tesco would get warrants to buy as much as 10 percent of the equity in the reorganized supermarket chain. Should Yucaipa win a proposed court-sanctioned auction, a Tesco unit would retain 22.5 percent of the equity in the reorganized chain.
GateHouse Media Inc., the community newspaper publisher overseen by the co-chairman of Fortress Investment Group LLC, filed for bankruptcy after creditors approved a plan to combine its assets with those recently purchased by Newcastle Investment Corp., Bloomberg News reported on Friday. GateHouse, based in Fairport, N.Y., listed assets of $433.7 million and debt of $1.3 billion in a chapter 11 petition filed on Friday. The prepackaged restructuring plan hinges on the combination of GateHouse with assets of Dow Jones Local Media Group, which Newcastle bought from News Corp. this month for $87 million.
After Washington Mutual became the biggest bank failure in U.S. history, 92 of its officers and executives tried to profit from the collapse through illegal golden-parachute payments, according to a claim by the bank's receiver, Courthousenews.com reported yeserday. The WMI Liquidating Trust sued the Federal Deposit Insurance Corp., the Board of Governors of the Federal Reserve, and the 92 former bank officers in Federal Court. Washington Mutual filed for bankruptcy and was placed in receivership in 2008. JPMorgan Chase bought it for $1.9 billion in September 2008, in a deal brokered by the federal government. WaMu had $310 billion in assets when it collapsed. In its 103-page lawsuit, the WMI Liquidating Trust seeks a judgment that various severance and benefits sought in bankruptcy proceedings are prohibited by the federal Golden Parachute Regulations.
GateHouse Media Inc., the community newspaper publisher overseen by the co-chairman of Fortress Investment Group LLC, said that it will seek votes today on a plan to reorganize in bankruptcy, Bloomberg News reported yesterday. Fairport, N.Y.-based GateHouse has proposed a pre-packaged plan that will allow it to enter chapter 11 bankruptcy with creditor support if more than 67 percent of debt holders accept, the company said in a regulatory filing on Friday. The publisher has said that it plans to file for bankruptcy as part of a move to merge its media assets with those recently bought by Newcastle Investment Corp. The reorganization, which has support from most creditors, hinges on the combination of GateHouse with assets of Dow Jones Local Media Group, which Newcastle bought from News Corp. in this month for $87 million.
Exide Technologies Inc. won court approval to pay more than $16 million in bonuses to employees to help ensure the battery maker is able to carry out its restructuring plan, Dow Jones Newswires reported yesterday. Bankruptcy Judge Kevin J. Carey signed off on Tuesday on the three bonuses plans, under which unnamed insiders will get payouts of $16.1 million if targets are reached and 51 noninsiders will get $1.63 million. The company, which manufactures and recycles lead-acid batteries, has battled with the Environmental Protection Agency and a number of state regulators which want to make sure Exide won't skirt environmental liabilities through its bankruptcy case.
Furniture Brands International Inc. has asked a bankruptcy judge to allow it to pay more than $5 million in bonuses to 55 employees if it successfully sells its assets at an auction, the St. Louis Business Journal reported yesterday. Furniture Brands announced Sept. 9 that it had filed for Chapter 11 bankruptcy and will sell most of its assets to an investment firm. Furniture Brands, which is led by Chairman and CEO Ralph Scozzafava, listed $547 million in assets and $550 million in debt.
Peabody Energy Corp., the company responsible for creating now-bankrupt Patriot Coal through a 2007 spinoff, said on Friday that it has no obligation to fund health and pension benefits for Patriot retirees affected by the company's insolvency, Reuters reported on Friday. Peabody said in court papers that new labor deals between Patriot and the United Mine Workers of America effectively relieve Peabody of any funding obligations. In a lawsuit relating to Patriot's bankruptcy, Patriot and Peabody are fighting over the responsibility to fund benefits for a group of about 3,100 retirees that Peabody agreed to continue covering after the October 2007 spinoff. A judge in May declared that Peabody was relieved of that burden when Patriot abrogated its labor obligations for all employees and retirees earlier this year and negotiated new, cost-saving deals as part of its restructuring in chapter 11 bankruptcy.
A bankruptcy judge yesterday cleared Mexican phone company Maxcom Telecomunicaciones S.A.B. to exit chapter 11 protection under the control of a group of investors led by private-equity firm Ventura Capital Privado S.A., Dow Jones Daily Bankruptcy Review reported today. Bankruptcy Judge Peter Walsh signed off on the company's prepackaged chapter 11 restructuring plan, which Maxcom filed when it sought bankruptcy protection in late July. Under the restructuring plan, the Ventura-led investors will pump $45 million into the company through an equity tender offer for up to 100 percent of the reorganized company's shares.
Since filing for bankruptcy nearly five years ago, the Lehman estate has paid more than $2 billion in fees and expenses to professionals, dwarfing the previous record of $757 million in Enron Corp.’s bankruptcy, Bloomberg News reported today. In exchange for that pay, approved by the bankruptcy court, Lehman creditors are poised to get 18 cents on the dollar by 2016 from an estate valued at $65 billion, according to a liquidation plan approved in December 2011. Harvey Miller, Lehman's lead attorney, estimated that the recovery may rise to as much as 22 cents on the dollar as the value of Lehman’s assets increases over the next three years to about $80 billion. Lehman, which listed $613 billion in debt when it filed, is scheduled to pay out $14 billion to creditors on Oct. 3, bringing total distributions to $43 billion since its chapter 11 plan was approved, according to court records. http://www.bloomberg.com/news/print/2013-09-11/lehman-recovery-seen-as-…
ABI will be holding a media teleconference at 2 p.m. ET tomorrow with primary figures involved in the Lehman chapter 11 filing to examine the Lehman case and the lessons learned from it, so that large financial institutions can be better equipped to emerge from financial distress in the future. Experts on the teleconference include Bankruptcy Judge James Peck, Harvey Miller of Weil, Gotshal & Manges LLP (New York), Dennis Dunne of Milbank, Tweed, Hadley & McCloy (New York), Bryan Marsal of Alvarez and Marsal (New York) and Chris Kiplock of Hughes Hubbard & Reed LLP (New York). There is limited space available for ABI members that would like to join the teleconference. To join, please contact ABI Public Affairs Manager John Hartgen at jhartgen@abiworld.org.
