Bloomberg describes the latest example of a priming transaction that left minority lenders “fuming.” Recently, Incora, an aerospace supplier, announced a transaction with Silver Point Capital and Pacific Investment Management Co. in which it received new financing and will potentially save up to $90 million in interest expense. The transaction includes what Bloomberg characterized as
Talc claimants should have their appeal of a decision permitting J&J-subsidiary LTL Management to continue its Chapter 11 proceedings heard as soon as possible, according to the same bankruptcy judge that issued the decision. In February, Judge Michael Kaplan of the U.S. Bankruptcy Court of New Jersey permitted the company to stay in Chapter 11,
Whether—and in what circumstances—a debtor should pay creditors a make-whole premium continues to be litigated in bankruptcy courts. Last week, as reported by Bloomberg, Judge Dorsey (Delaware) ruled that the debtor – Mallinckrodt Plc – did not need to pay a make whole premium to first lien lenders in order to reinstate such obligations
Hertz is making big news just months after emerging from its successful Chapter 11 bankruptcy. As reported by NBC News, Hertz has signed deals with Tesla (to add at least 100,000 Teslas to its fleet), Uber (to make up to half of those Teslas available to Uber drivers), and with Carvana (to sell its
Bloomberg reports that shareholders in Latam Airlines Group SA’s chapter 11 case have organized into an ad hoc committee and hired the same counsel that represented equity holders in Hertz. Shareholders see the potential for the Latam bankruptcy to produce a recovery to common equity; similar to Hertz, Latam is a travel company, was in
The Wall Street Journal reports on the winning bid in the 36-hour auction for control of Hertz in anticipation of its emergence from bankruptcy later this summer. The winning bidders, a group of co-investors led by Knighthead Capital Management and Certares Management, will buy the bulk of Hertz’s equity upon emergence for $2.8 billion. Assuming
In a March 2021 decision in the jointly administered bankruptcy cases of Fencepost Productions, Inc. and certain of its affiliates, Judge Dale L. Somers of the Bankruptcy Court for the District of Kansas declined to enforce a voting restriction in subordination agreements between two of the debtors’ creditors, but nonetheless found that the deeply subordinated creditors were barred from voting on the debtors’ plan because they lacked prudential standing.[1] In declining to enforce the contractual voting restriction, the decision defies a trend toward enforcing subordination and intercreditor agreement terms – so long as they are specific and express – even if such terms may limit a party’s statutory rights as a creditor in bankruptcy. Instead, Judge Somers applied a federal court jurisdictional doctrine, the relevance of which can only be determined on a case-by-case basis.
Continue Reading In re Fencepost Productions: Prudential Standing Doctrine Blocks a Subordinated Creditor from Voting
As Texas recovers from its winter energy crisis, hard hit consumers and retail power providers may be facing potential bankruptcies caused by the extreme price fluctuations experienced during the cold. The New York Times describes the plight faced by consumers who may face energy bills in the thousands. And retail power companies that supplied power
The Wall Street Journal reports that high demand for corporate debt has allowed even the riskiest of companies to refinance their debt at interest rates that have typically been reserved for only the safest types of debt. Since the beginning of the year through February 10, over $13 billion of new debt has been issued,