UPDATE 1-Billionaire Rennert, firm must pay $118 mln for looting company -jury

Fri Feb 27, 2015 4:33pm EST

(Adds comment from Renco in sixth paragraph, additional byline)

By Joseph Ax and Nate Raymond

NEW YORK Feb 27 (Reuters) - Billionaire Ira Rennert and his investment firm were ordered on Friday to pay $118.2 million after being found liable for looting a magnesium company to build one of the most expensive mansions in America.

A Manhattan federal jury found Rennert and Renco Group Inc liable for breach of fiduciary duty and other claims following a three-week trial over a lawsuit brought by the trustee for the estate of Magnesium Corp of America, a company the billionaire controlled until its 2001 bankruptcy.

The jury found Rennert liable for $16.222 million and Renco liable for $102 million.

Lawyers for Lee Buchwald, MagCorp's trustee, are seeking interest that could increase the award to nearly $700 million for MagCorp creditors, though Rennert's lawyers contest that figure.

Rennert, 80, is worth $6.1 billion, according to Forbes. His lawyers told U.S. District Judge Alison Nathan they plan to ask her to set aside the verdict.

"Clearly, the jury was swayed by a passionate, but wholly unsupported, argument," Renco said in a statement. "Renco and the management of MagCorp always acted properly and did not engage in the acts of which the Trustee wrongly accused them."

Renco bought Utah-based MagCorp, one of the world's largest magnesium producers, in 1989 for $44 million.

MagCorp was coming off years of financial struggles and environmental violations, yet Renco did nothing to fix those problems, Buchwald contended.

In the mid-1990s, magnesium prices reached record highs, allowing Renco to double MagCorp's long-term debt to $150 million and use the proceeds to pay $118 million to Renco and its directors in 1996.

Buchwald's lawyers said the money was improperly taken from MagCorp to finance the construction of an oceanfront, 43,000-square-foot mansion with 21 bedrooms and 18 bathrooms in Sagaponack, New York, among other expenses.

As of 2013, the property was valued at $248 million, according to the website Zillow.com.

In court papers, Rennert's lawyers described the case as an attempt to twist the story of a successful entrepreneur into "a picture of avarice."

Buchwald argued that at the time of the debt offering, MagCorp was insolvent because of environmental liabilities.

It filed for bankruptcy in 2001 after the U.S. government sought $900 million in penalties.

Rennert's lawyers argued the liabilities were contingent and unknowable at the time the debt was issued.

"At the end of the day, they understood the evidence and returned a just verdict," Scot Stirling, a lawyer for the trustee, said of the jurors.

The case is Buchwald v The Renco Group Inc, et al, U.S. District Court, Southern District of New York, No. 13-7948. (Reporting by Joseph Ax and Nate Raymond in New York; Editing by Dan Grebler and Alan Crosby)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

Puerto Rico's Prepa to miss restructuring deadline - official

NEW YORK Fri Feb 27, 2015 5:11pm EST

NEW YORK Feb 27 (Reuters) - Puerto rico's debt-laden power authority, Prepa, said on Friday that it will hold off on presenting a restructuring plan to creditors as it continues to negotiate an extension of forbearance agreements with bondholders and lenders.

The current agreement, which expires on March 31, had called for a deadline of this Monday for Prepa to unveil a proposal to restructure about $9 billion in debt. But it will miss that deadline, Lisa Donahue, Prepa's chief restructuring officer, said in a statement. (Reporting by Megan Davies and Nick Brown; Editing by Bernard Orr)

16.47 | 0 komentar | Read More

UPDATE 1-Puerto Rico's Prepa to miss restructuring deadline - official

Fri Feb 27, 2015 5:43pm EST

(Adds details from Donahue's statement)

NEW YORK Feb 27 (Reuters) - Puerto Rico's debt-laden power authority, Prepa, said on Friday that it will hold off on presenting a restructuring plan as it tries to secure an extension of an agreement from creditors not to foreclose on its $9 billion in debt.

The current agreement, which expires on March 31, had called for a deadline of this Monday for Prepa to unveil a proposal to restructure about $9 billion in debt. But it will miss that deadline, Lisa Donahue, Prepa's chief restructuring officer, said in a statement.

"We have made significant progress" to negotiate an extension of the forbearance agreement, "but there is more work to do and as a result, we have not yet finalized a plan to present to the forbearing creditors."

Donahue said she told creditors Prepa "would not satisfy this milestone," and that creditors do not plan to call a default as a result of the delay.

Reuters reported on Thursday that Prepa would likely miss the deadline as negotiators weigh dropping energy prices and legislative uncertainty on the island. (Reporting by Megan Davies and Nick Brown; Editing by Bernard Orr and Christian Plumb)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

GameStop nabs 163 RadioShack leases for Spring Mobile push

By Tom Hals

Thu Feb 26, 2015 5:01pm EST

Feb 26 (Reuters) - GameStop Corp may sharply increase the number of its Spring Mobile stores after the company bid on Wednesday for the right to take 163 leases over from electronics retailer RadioShack Corp, which filed for bankruptcy this month.

The agreement allows GameStop to decide in about two months if it will take on the obligation of the RadioShack leases or terminate the lease, according to a filing in the U.S. Bankruptcy Court in Wilmington, Delaware.

The video game retailer said it had agreed to pay $15,000 for each RadioShack store lease.

"We can confirm that GameStop has submitted a bid to acquire a select number of RadioShack's U.S. leases," said an email sent on Thursday from GameStop spokeswoman Jackie Smith. "If awarded these leases the locations would be primarily used to expand the retail footprint of our Spring Mobile business, which is an exclusive AT&T dealer."

On Friday, RadioShack will ask U.S. Bankruptcy Judge Brendan Shannon to approve the agreement with GameStop, which had 311 Spring Mobile stores as of its most recent quarterly regulatory filing in November. GameStop has focused on expanding Spring Mobile and Simply Mac, a retail chain which sells Apple products.

Despite the sale to GameStop, RadioShack largely came up empty at Wednesday's lease auction. The chain was selling leases to 1,100 stores that it is abandoning this month, and court documents showed only four other leases drew bidders.

RadioShack is planning an auction next month for about 2,000 stores that will remain open. Standard General, a hedge fund, has agreed to present an initial $200 million bid at the auction.

Another group of RadioShack stores will be abandoned in March, and those leases will also be auctioned. (Reporting by Tom Hals in Wilmington, Delaware, editing by G Crosse)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

Texas Wyly brothers must pay $299 million in SEC fraud case: judge

By Nate Raymond

NEW YORK Thu Feb 26, 2015 7:08pm EST

NEW YORK Feb 26 (Reuters) - A federal judge on Thursday ordered Texas tycoon Sam Wyly and his late brother's estate to pay the U.S. Securities and Exchange Commission $299.4 million for engaging in securities fraud.

The order by U.S. District Judge Shira Scheindlin in Manhattan followed months of wrangling over the exact amount Wyly and the estate of Charles Wyly should pay after a jury found them civilly liable in May.

The judge ordered Sam Wyly, 80, to pay $198.1 million in disgorged gains and interest, while his Charles Wylys' estate was directed to pay $101.2 million.

"We are pleased with the judgment and will take every available step to enforce it," said Andrew Ceresney, director of enforcement at the SEC.

A lawyer for the Wylys declined comment.

The final judgment sets the case up for an appeal amid the ongoing bankruptcy of Sam Wyly, a once-reported billionaire who filed for Chapter 11 protection in October amid the SEC's pursuit for damages.

The SEC, which sued the Wylys in 2010, contended the brothers earned $553 million in undisclosed profits by trading in four companies using trusts in the Isle of Man.

The companies included Sterling Software Inc, Michaels Stores Inc, Sterling Commerce Inc and Scottish Annuity & Life Holdings Ltd, now Scottish Re Group Ltd.

Charles Wyly died in 2011, a year after the SEC sued, and his estate was substituted as a defendant. His widow, Caroline, has filed for bankruptcy as well, citing the SEC claim.

Scheindlin in a related ruling Thursday concluded that the Wylys were entitled to an offset for amounts due to the Internal Revenue Service based on amounts paid to the SEC.

The case is U.S. Securities and Exchange Commission v. Wyly et al, U.S. District Court, Southern District of New York, 10-5760. (Reporting by Nate Raymond in New York; Editing by Cynthia Osterman)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

Talvivaara says talks with potential buyers continue

HELSINKI Fri Feb 27, 2015 2:28am EST

HELSINKI Feb 27 (Reuters) - Troubled Finnish nickel miner Talvivaara on Friday said talks with potential buyers continued, but added there was "substantial uncertainty" that a deal could be found that would keep its mine running in the Northern Finland.

"On the date of this announcement, the negotiations... are still on-going, and no further clarity has yet been received on the continuance of the operations or on the entity to take over the operations," the firm said in its interim report.

Last year, a Talvivaara subsidiary which holds all of the group's mining assets applied for bankruptcy protection following a drop in nickel prices, repeated production disruptions and environmental damage.

The Finnish government earlier this week said it would set aside a further 97 million euros to help restructure Talvivaara if a private buyer is found, but might otherwise shut down the mine. (Reporting By Jussi Rosendahl, editing by William Hardy)

16.47 | 0 komentar | Read More

UPDATE 2-RadioShack goes to auction to test hedge fund $200 mln deal

Wed Feb 25, 2015 5:49pm EST

(Updates throughout with judge approving auction process and loan)

By Tom Hals

WILMINGTON, Del. Feb 25 (Reuters) - RadioShack Corp got approval on Wednesday from a U.S. Bankruptcy Court judge to auction about 2,000 stores with an initial $200 million bid from the Standard General hedge fund.

The electronics retailer also received approval to borrow up to $285 million. However, the judge hearing the case, Brendan Shannon in Wilmington, Delaware, said the associated fees for the loan had to be cut, calling it "money for nothing."

Only about $35 million of the loan is new liquidity, with the rest refinancing previous loans.

Shannon scheduled the auction for March 23 if competing bids are received.

Wednesday's hearing was the first time the bankrupt company has put an estimated value on the sale agreement with Standard General, which will keep about half of RadioShack's stores open and operate them under an agreement with Sprint Corp.

At the same hearing, RadioShack lawyers said the company had received bids for leases to 205 of the 1,100 locations it plans to close this month, including interest from a unit of the GameStop Corp retail chain.

The lawyers also said the company's name and intellectual property would be auctioned separately and that Standard General agreed to an initial bid of at least $20 million.

Shannon denied a request by the official committee of unsecured creditors to force Standard General to bid in cash, but said he needed to know more details about the exact value of their bid.

Standard General is planning what is known as a "credit bid," using the $55 million it is owed on RadioShack loans to help pay for the stores.

In addition, Standard General plans to offer loans held by other hedge funds, which could bring its credit bid to $130 million.

RadioShack's financial advisor, David Kurtz, the head of restructuring at Lazard Ltd, said Standard General would bid $75 million in cash.

While Wednesday's hearing was under way, RadioShack was simultaneously holding an auction for the leases to the 1,100 stores it will close this month.

RadioShack lawyer Tom Howley said GameStop's Spring Communications was interested in some locations and called this a "significant development" without elaborating.

GameStop has been aggressively expanding its Spring Mobile business, which sells AT&T cellphones.

RadioShack filed for bankruptcy earlier this month after struggling for years against online competitors.

The case is In re RadioShack Corp, U.S. Bankruptcy Court, District of Delaware, No. 15-10197. (Reporting by Tom Hals in Wilmington, Delaware; Editing by Lisa Von Ahn and David Gregorio)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

Chapter 9 a 'Wild West' solution for Puerto Rico agencies -adviser

NEW YORK Wed Feb 25, 2015 6:12pm EST

NEW YORK Feb 25 (Reuters) - A proposed bill to give Puerto Rico's ailing public agencies a way to restructure debts under U.S. bankruptcy law is a "Wild West" solution that would likely hurt bondholders, an adviser for major investors argued in written testimony ahead of a key congressional committee.

The bill to give Puerto Rico's agencies the ability to file under Chapter 9 of the U.S. bankruptcy code - used by cities such as Detroit, Michigan, and Stockton, California - was proposed by the U.S. territory's representative to Congress, Democrat Pedro Pierluisi. It will be heard on Thursday.

"Use of Chapter 9 by any of Puerto Rico's public corporations will cause more harm than good, for both millions of Americans who invested in Puerto Rico bonds and for the Commonwealth," according to testimony from Thomas Mayer, a partner at Kramer Levin.

Mayer represents funds managed by Franklin Municipal Bond Group and OppenheimerFunds Inc in respect to their investment in $1.6 billion of bonds issued by Puerto Rico's electric utility, PREPA. PREPA is in dire shape, laden with about $9 billion in debt and already deep in restructuring negotiations with bondholders.

Using Chapter 9 would force bondholders to shoulder the burden of PREPA's operational failures and Puerto Rico's fiscal irresponsibility, Mayer said.

"Chapter 9 is the Wild West," Mayer's testimony said. "The only certainty is that Chapter 9 takes a long time - at least 18 months to three years - and is very expensive."

Pierluisi has argued that the bill empowers the Puerto Rico government to authorize its insolvent public corporations to use a "tried-and-true legal procedure" and would be in the best interests of all stakeholders, including creditors.

Discussion about the bill was reignited when a federal court on Feb. 6 struck down a local law enacted by the Caribbean island granting agencies similar debt-restructuring authority.

Puerto Rico's Government Development Bank, which finances many of the territory's official functions, said Chapter 9 would be a "useful tool for Puerto Rico's long-term economic success, whether or not it is actually invoked," according to testimony from GDB President Melba Acosta.

Acosta said Chapter 9 provides a legal regime already understood by the markets, creditors, prospective lenders and suppliers. (Reporting by Nick Brown and Megan Davies)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

BRIEF-Bankruptcy judge says to approve process for RadioShack Corp auction

Wed Feb 25, 2015 5:11pm EST

Feb 25 (Reuters) - RadioShack Corp : * Bankruptcy judge says to approve process for RadioShack Corp

auction, with initial bid from standard general * Bankruptcy judge sets auction of 2,000 RadioShack Corp Stores for

March 21, if competing bids received * Bankruptcy judge: to approve $285 million bankruptcy loan for RadioShack Corp

16.47 | 0 komentar | Read More

Brazil judge in Batista case seen driving tycoon's seized Porsche

By Stephen Eisenhammer

RIO DE JANEIRO Tue Feb 24, 2015 3:37pm EST

RIO DE JANEIRO Feb 24 (Reuters) - The Brazilian judge presiding over criminal proceedings against charismatic entrepreneur Eike Batista, once Brazil's richest man, was seen on Tuesday driving a Porsche belonging to the fallen tycoon that had been seized by the court.

Flavio Roberto de Souza, who is overseeing Batista's trial for insider trading, was seen driving the white Porsche Cayenne by reporters for Estado de S.Paulo's news agency after a tip-off from Batista's lawyer.

The car was one of a number of luxury vehicles confiscated by police earlier this month following a court order.

Local media said investigators had seized the cars because of concerns Batista had been selling or donating assets that were frozen as part of the insider trading case.

When asked why he was driving the Porsche, Souza told local business daily Valor Economico: "The Federal Police did not have a safe place for the car and it was exposed to sun, rain and possible damage. As I want the car to be preserved in good condition, I took it to a covered parking space (in the building where I live)."

"I did not take it to use, just to look after it... It is a normal situation," he said.

The cars were meant to be put up for auction this Thursday, but Batista's lawyer secured an injunction halting the sale.

Batista lost almost everything as his EBX conglomerate fell apart and his flagship oil firm OGX filed for Latin America's largest bankruptcy in 2013. The business magnate, whose rise and fall have mirrored Brazil's own fortunes, recently resigned as chairman of Oleo E Gas Participações SA, as OGX is now known.

Prosecutors accuse Batista of selling 236 million reais ($85 million) of OGX stock based on privileged information that its offshore oil fields would miss production forecasts. Batista denies selling the stock based on insider information, and says he was legally obliged to sell it to pay off debt.

The Porsche incident is likely to give further ammunition to Batista's lawyer, Sergio Bermudes, who has been trying to get judge Souza taken off the case. Bermudes has argued that Souza has a bias against Batista, pointing to comments the judge made on the first day of trial in November.

Souza told reporters at the time that Batista's career had been a "megalomaniac dream." (Reporting by Stephen Eisenhammer; Editing by Todd Benson and Gunna Dickson)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

UPDATE 1-Arion Banki to revive senior deal

Tue Feb 24, 2015 11:11am EST

(Add background, quotes)

By Alice Gledhill

LONDON, Feb 24 (IFR) - Arion Banki is taking steps towards reviving the senior deal it postponed last April, buoyed by increased risk appetite and an improving backdrop for the country's banks.

The Icelandic lender looked at the market last spring, but the pricing on offer was more than the issuer wanted to pay and plans were delayed further by deteriorating market conditions.

However, the tone has improved markedly, helped by the European Central Bank (ECB) announcement in January that it would start buying 60bn of government bonds monthly until at least September 2016, driving yields lower and spreads tighter across asset classes.

"The market is more constructive in a broader context than it has been for a long time, and Iceland has made good progress in the last 12 months around topics such as the capital controls. This has driven in spreads for the sovereign significantly, and the sovereign itself was well received when it was active in the market," said Tommy Paxeus, head of Nordic FIG DCM at Deutsche Bank.

According to Eikon, Iceland's 2.5% July 2020 bond has tightened by almost 60bp since the end of last year to a Z-spread of 131.86bp.

The transaction from the issuer formerly known as Kaupthing Bank would be its first wholesale deal in a major currency in more than six years.

Islandsbanki last May priced a 100m two-year issue that was Iceland's first euro-denominated bank bond since the country's financial collapse.

"This is an exercise undertaken by Arion in establishing Icelandic banks as regular issuers," Paxeus added.

The bank is to host an investor call on Wednesday, February 25, regarding its annual results, due to be released today (Tuesday).

This will be succeeded by a series of investor meetings in Europe on Thursday and Friday, via Citigroup, Deutsche Bank and Nomura, ahead of the possible euro-denominated trade.

Deutsche's Paxeus said that the roadshow would be crucial to establishing size, maturity and pricing.

"The price should be lower now than ever since the start of the crisis, as both the Icelandic banks and the sovereign are in a good position. Arion has a strong balance sheet, stable business model and is extremely well capitalised."

In a debt investor presentation released in the third quarter of 2014, Arion Banki said it was well prepared for the lifting of capital controls and had a 21.1% Core Tier 1 ratio.

Arion Banki is rated BB+ by S&P with a positive outlook. It is 87% owned by its creditors and 13% by the Icelandic government. (Reporting by Alice Gledhill, editing by Helene Durand, Philip Wright)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

Brazil shipbuilder OSX says CFO steps down, CEO to take role

RIO DE JANEIRO Tue Feb 24, 2015 4:34pm EST

RIO DE JANEIRO Feb 24 (Reuters) - OSX Brasil SA Chief Financial Officer Claudio Antônio da Silva Zuicker is stepping down, and Chief Executive Officer Vladimir Kundert Ranevsky will add the role of CFO, the troubled Brazilian shipbuilder said in a statement on Tuesday.

OSX is the shipbuilding arm of the EBX conglomerate started by fallen tycoon Eike Batista, who was once Brazil's richest man but lost almost everything as his companies failed under mounting debt and missed targets. (Reporting by Stephen Eisenhammer; Editing by David Gregorio)

16.47 | 0 komentar | Read More

BRIEF-Warsaw court says DDS to undergo bankruptcy and liquidation

Mon Feb 23, 2015 7:30am EST

Feb 23 (Reuters) - Dolnoslaskie Surowce Skalne SA w upadlosci likwidacyjnej (DDS) :

* Court in Warsaw appoints Cezary Zalewski the company's judge commissioner and Lechoslaw Kochanski administrative receiver Source text for Eikon: Further company coverage: (Gdynia Newsroom)

16.47 | 0 komentar | Read More

American Airlines says won't participate in Skymark Airlines restructuring now

Mon Feb 23, 2015 4:53pm EST

Feb 23 (Reuters) - American Airlines Group Inc has decided not to participate in the restructuring of Japan's bankrupt Skymark Airlines Inc at this time, a spokesman said following a media report that said it was considering a tie-up with Skymark.

"Asia remains an important and evolving part of the competitive landscape, and we are partnered with the premier airline in that region today: Japan Airlines," Josh Freed, an American spokesman, said in an email on Monday, noting that the company had made the decision after studying the current environment surrounding Skymark. (Reporting by Jeffrey Dastin)

16.47 | 0 komentar | Read More

UPDATE 1-American and Delta not interested in Skymark Airlines tie-up

Mon Feb 23, 2015 6:49pm EST

(Changes headline, adds Delta comment, background, byline)

By Jeffrey Dastin

Feb 23 (Reuters) - American Airlines Group Inc and Delta Air Lines Inc have no plans to rescue Japan's bankrupt Skymark Airlines Inc, the two companies said separately on Monday following a media report on their alleged interest in the budget carrier.

"We have studied the current environment surrounding Skymark and have determined not to participate in that airline's restructuring needs at this time," American spokesman Josh Freed said in an email. "We are partnered with the premier airline in that region today, Japan Airlines."

Delta spokesman Anthony Black said in a telephone interview, "We have no plans to invest in or partner with Skymark."

Nikkei Asian Review reported earlier that American intended to send executives to Japan to discuss investment in Skymark, and that a tie-up interested Delta, which lacks a Japanese partner in its SkyTeam alliance.

The report came as Japan's biggest carrier, ANA Holdings Inc , and a subsidiary of Malaysia's AirAsia Bhd expressed interest in Skymark. Meanwhile, U.S. carriers are increasingly competing for passengers between East Asia and the United States.

Skymark holds landing slots at Tokyo's Haneda Airport that many airlines consider valuable. An agreement between Japan and the United States limits U.S. carriers to four slots there.

The U.S. Department of Transportation currently is reviewing whether to award one of Delta's Haneda slots to American or Hawaiian Airlines to increase consumers' choices. These airlines say passengers will prefer Haneda to Narita International Airport because it is closer to downtown Tokyo.

Skymark sought protection from creditors last month, saying a weak yen and a dispute with jet maker Airbus Group fueled its financial problems. It had liabilities of 71.09 billion yen ($596.24 million).

The airline has agreed on a nine billion-yen sponsorship deal with Tokyo-based investment fund Integral Corp to keep its business running and has looked for co-sponsors to help turn the business around. (Reporting by Jeffrey Dastin and by Antoni Slodkowski; Editing by Diane Craft)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

BRIEF-ANA Holdings considers investment in Skymark Airlines

Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests.

NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

16.47 | 0 komentar | Read More

ANA confirms offer to help Skymark rehabilitation

TOKYO Sun Feb 22, 2015 11:11pm EST

TOKYO Feb 23 (Reuters) - Japan's biggest airline, ANA Holdings Inc, confirmed on Monday that it offered to help bail out bankrupt airline Skymark Airlines Inc.

ANA said it expressed interest in participating in the reconstruction of the budget airline, which last month filed for protection from creditors with total liabilities of 71.09 billion yen ($597 million). The deadline to submit expressions of interest was Monday for airlines and last Thursday for non-aviation companies.

People with knowledge of the matter told Reuters last week that ANA and others including brokerage Daiwa Securities Group , Shinsei Bank, and financial services provider Orix Corp had expressed interest in taking part.

Skymark agreed a 9 billion-yen sponsorship deal with Tokyo-based fund Integral and is now seeking co-sponsors. (Reporting by Maki Shiraki; Writing by Ritsuko Ando; Editing by Chang-Ran Kim)

16.47 | 0 komentar | Read More

UPDATE 1-ANA Holdings considering investment in bankrupt Skymark Airlines

Mon Feb 23, 2015 2:10am EST

* Skymark had total liabilities of 71.09 bln yen

* Monday's deadline for airlines to submit Skymark reform interest (Adds background)

TOKYO Feb 23 (Reuters) - Japan's biggest airline, ANA Holdings Inc, said it was considering injecting capital in budget airline Skymark Airlines Inc as it applied to take part in the company's bankruptcy rehabilitation plan.

Skymark last month filed for protection from creditors with total liabilities of 71.09 billion yen ($597 million). It agreed on a 9 billion-yen sponsorship deal to keep the business going with Tokyo-based fund Integral and is now seeking co-sponsors to help it turn the business around.

The deadline to submit expressions of interest was Monday for airlines and last Thursday for non-aviation companies.

People with knowledge of the matter told Reuters last week that ANA and others including brokerage Daiwa Securities Group , Shinsei Bank, and financial services provider Orix Corp had expressed interest in taking part.

Interested parties will have until May 29 to work out a rescue plan before submitting it to the Tokyo District Court and seeking approval from Skymark's creditors.

Skymark is expected to start implementing the plan from around the end of July. (Reporting by Antoni Slodkowski; Editing by Muralikumar Anantharaman)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

US appeals court decision may speed new payout to Madoff victims

By Jonathan Stempel

NEW YORK Fri Feb 20, 2015 1:46pm EST

NEW YORK Feb 20 (Reuters) - Victims of Bernard Madoff's massive fraud are not entitled to inflation or interest adjustments on their claims, a federal appeals court ruled on Friday, in a decision that could speed the return of more than $1 billion to the swindler's former customers.

Irving Picard, the trustee liquidating Bernard L. Madoff Investment Securities LLC, said he will seek permission from a federal bankruptcy judge to distribute that sum, on top of $7.2 billion paid out so far, as soon as possible.

Picard has kept the additional money in reserve because of litigation over whether former customers deserved "time-based" damages on claims arising from Madoff's Ponzi scheme that was uncovered in 2008.

In Friday's decision, the 2nd U.S. Circuit Court of Appeals in New York said that because the Securities Investor Protection Act, a federal law that helps victims of failed brokerages, did not address such damages, Picard had the flexibility to choose the fairest method to determine the size of valid claims.

Writing for a unanimous three-judge panel, Circuit Judge Chester Straub also said it would be unfair to adjust for inflation and interest the claims of earlier customers, at the expense of later customers.

"Even if all customer property were miraculously recovered, it would be insufficient to satisfy customer claims to the extent such claims were increased to reflect inflation," Straub wrote. "An inflation adjustment to net equity claims could allow some customers to obtain, in effect, a protection from inflation for which they never bargained."

Friday's decision upheld a Sept. 2013 ruling by U.S. Bankruptcy Judge Burton Lifland in Manhattan.

Lifland said Madoff's customers had not bargained for inflation protection or guaranteed returns, and that calculating inflation and interest adjustments would be impossible because their final account statements had been fabricated.

No decision has been made on further appeals.

"It's obviously a disappointment," Greg Schwed, who argued the appeal for some claimants, said in a phone interview.

Amanda Remus, a spokeswoman for Picard, called the decision an "important milestone," saying the only obstacle to the additional payout was a further appeal. Picard is hopeful any further delay would be viewed as "pointless," she said.

Lifland died in January 2014.

Picard has recouped $10.55 billion for Madoff victims who lost an estimated $17.5 billion of principal. Madoff, 76, is serving a 150-year prison term after pleading guilty to running a decades-long fraud.

The case is In re: Bernard L. Madoff Investment Securities LLC, 2nd U.S. Circuit Court of Appeals, No. 14-97. (Reporting by Jonathan Stempel in New York; Editing by Frances Kerry)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

Uncertainty around RadioShack CDS payouts

By Mike Kentz

Fri Feb 20, 2015 2:45pm EST

NEW YORK, Feb 20 (IFR) - An auction for RadioShack credit default swaps next month is expected to be more complex than usual due to a scarcity of bonds that is likely to make it hard to value the securities.

The International Swaps and Derivatives Association (ISDA) is holding the auction to determine the value of credit default swaps written on RadioShack's 6.75% US$324m May 2019 issue that is bid at just 13.5 cents on the dollar.

It is the first case of its kind since ISDA changed the way auctions can be settled in 2009 in a overhaul known broadly as the "Big Bang," according to ISDA.

Those changes ultimately allowed the contracts to be settled in cash as well as physical delivery.

Analysts said it would be difficult to predict the extent of losses sellers of CDS may face or, if they are lucky, an elevated CDS recovery final auction price.

CDS contracts are settled through an auction where buyers deliver a physical bond to sellers and then receive a cash payout based on the bond's price. Buyers and sellers can also choose to settle financially.

The final price is determined by the net demand by participants to physically deliver or physically receive the bond. The majority of contracts are cash-settled, but the auction price on the first week of March that determines payouts across all CDS contracts will be determined by the net physical settlement demand.

In most cases, supply and demand even out. But in this case, the shortage of bonds relative to CDS has some worried that more requests could come in on either side that would skew the final price of the bond.

Participants that hold both the bond and CDS would want to physically deliver the bond because it would remove the price risk associated with the auction. Sellers of CDS would want to receive the bond to guarantee themselves a spot in the bankruptcy process and at least some return rather than only paying out.

"While the auction process typically functions well, we would not be surprised to see significant volatility in the RadioShack 6.75s around the auction and an elevated CDS recovery final auction price," said Eric Gross, credit analyst at Barclays.

If Gross turns out to be right, CDS holders will get more bang for their buck, but others said it was just as feasible for the opposite to happen.

"There have been a number of notorious bond squeezes when there have been a lot of CDS outstanding and fewer deliverable bonds," said Paul Forrester, a partner in Mayer Brown's structured finance practice.

"It can drive up the price of the scarce bonds if more CDS settle physically, and in such a situation CDS buyers could get smaller payouts than they might otherwise have expected."

Market participants explained that sellers of CDS that don't own the bond would want to receive the bond because it gives them rights in the bankruptcy proceedings, primarily.

"It's difficult to predict because there's low visibility, but in this case we think the risk skews towards higher demand to receive the bond rather than deliver it, which would raise the CDS recovery price," said Jigar Patel, another credit analyst at Barclays.

But any rush to stock up on bonds could push their value higher, and ultimately lower the payout on CDS, and vice versa.

Some players have already sought to avoid any potential upset on payouts. While the US$476m outstanding in CDS is significantly higher than the available bonds outstanding, the number is markedly down from previous month's levels.

That signals some participants have already closed out positions ahead of the auction.

One month ago, RadioShack CDS net notional outstanding totaled US$532m. A year ago, it was over US$1bn.

"Unless you're a holder of both the CDS and the bond, you're probably not thinking you need to hold on to the contract any longer," said Patel. "Investors have kind of gotten the result they expected now, so it appears that people have been reducing positions."

THE PROCESS

The final payout is a two-stage process. First, dealers pool net demand from clients holding CDS positions to determine the 'open interest' for the bonds and provide two-way markets to establish an initial price indication.

In the second phase, market participants have several hours to submit either bids or offers, as required, to clear the open interest. The final price is determined by the price at which the open interest is cleared.

RadioShack filed for Chapter 11 bankruptcy this month. It plans to close 1,700 stores this month and sell 2,400 stores to Standard General, which is also the chain's leading lender.

The restructuring process is expected to be a long, drawn out affair, with unsecured creditors saying the company should have filed for bankruptcy in May when it first planned to close more than 1,000 unprofitable stores. (Reporting by Mike Kentz; Editing by Natalie Harrison and Shankar Ramakrishnan)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

Ivanhoe Energy seeks bankruptcy protection as oil prices weigh

CALGARY, Alberta Fri Feb 20, 2015 4:30pm EST

CALGARY, Alberta Feb 20 (Reuters) - Ivanhoe Energy Inc said on Friday it will seek protection under Canada's Bankruptcy and Insolvency Act, as the company becomes the latest small oil-sands developer to struggle with oil prices that have fallen by more than half since June.

The company has been unable to make a C$2.1 million ($1.7 million) payment on a debenture issue and received a default notice earlier this week for the C$73.3 million issue. Ivanhoe was founded by famed mining investor Robert Friedland, who has lent the company $2.74 million since October.

Ivanhoe is the latest small oil sands developer struggling to survive low oil prices while operating in one of the world's highest-cost regions. It owns the Tamarack thermal oil sands property in northern Alberta and controls another heavy oil property in Ecuador.

Privately held Laricina Energy Ltd said on Friday it would suspend operations at its Germain heavy oil project and put expansions at the site estimated to contain almost 1 billion barrels of tar-like bitumen on hold.

Laricina, which said in October it would seek a buyer, is holding talks with the Canada Pension Plan Investment Board after it failed to meet covenants on a C$150 million note issue.

Under the terms of the Bankruptcy and Insolvency Act, Ivanhoe has up to six months of protection from creditors to restructure its operations. If the company, which had $61.3 million in long-term debt at the end of the third quarter, cannot restructure its operations or find new financing it will become bankrupt.

"The company continues to be actively engaged in discussions with various stakeholders to recapitalize the company," Ivanhoe said in a statement. "Strategic and financial alternatives under consideration are focused on relieving the financial burden of the company's current debt structure and obtaining additional financing necessary to fund ongoing operations."

Ivanhoe shares were halted on the Toronto Stock Exchange. They last traded on Thursday at 87 Canadian cents.

($1 = 1.2535 Canadian dollars) (Reporting by Scott Haggett; Editing by Lisa Shumaker)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

Uncertainty around RadioShack CDS payouts

By Mike Kentz

Fri Feb 20, 2015 2:45pm EST

NEW YORK, Feb 20 (IFR) - An auction for RadioShack credit default swaps next month is expected to be more complex than usual due to a scarcity of bonds that is likely to make it hard to value the securities.

The International Swaps and Derivatives Association (ISDA) is holding the auction to determine the value of credit default swaps written on RadioShack's 6.75% US$324m May 2019 issue that is bid at just 13.5 cents on the dollar.

It is the first case of its kind since ISDA changed the way auctions can be settled in 2009 in a overhaul known broadly as the "Big Bang," according to ISDA.

Those changes ultimately allowed the contracts to be settled in cash as well as physical delivery.

Analysts said it would be difficult to predict the extent of losses sellers of CDS may face or, if they are lucky, an elevated CDS recovery final auction price.

CDS contracts are settled through an auction where buyers deliver a physical bond to sellers and then receive a cash payout based on the bond's price. Buyers and sellers can also choose to settle financially.

The final price is determined by the net demand by participants to physically deliver or physically receive the bond. The majority of contracts are cash-settled, but the auction price on the first week of March that determines payouts across all CDS contracts will be determined by the net physical settlement demand.

In most cases, supply and demand even out. But in this case, the shortage of bonds relative to CDS has some worried that more requests could come in on either side that would skew the final price of the bond.

Participants that hold both the bond and CDS would want to physically deliver the bond because it would remove the price risk associated with the auction. Sellers of CDS would want to receive the bond to guarantee themselves a spot in the bankruptcy process and at least some return rather than only paying out.

"While the auction process typically functions well, we would not be surprised to see significant volatility in the RadioShack 6.75s around the auction and an elevated CDS recovery final auction price," said Eric Gross, credit analyst at Barclays.

If Gross turns out to be right, CDS holders will get more bang for their buck, but others said it was just as feasible for the opposite to happen.

"There have been a number of notorious bond squeezes when there have been a lot of CDS outstanding and fewer deliverable bonds," said Paul Forrester, a partner in Mayer Brown's structured finance practice.

"It can drive up the price of the scarce bonds if more CDS settle physically, and in such a situation CDS buyers could get smaller payouts than they might otherwise have expected."

Market participants explained that sellers of CDS that don't own the bond would want to receive the bond because it gives them rights in the bankruptcy proceedings, primarily.

"It's difficult to predict because there's low visibility, but in this case we think the risk skews towards higher demand to receive the bond rather than deliver it, which would raise the CDS recovery price," said Jigar Patel, another credit analyst at Barclays.

But any rush to stock up on bonds could push their value higher, and ultimately lower the payout on CDS, and vice versa.

Some players have already sought to avoid any potential upset on payouts. While the US$476m outstanding in CDS is significantly higher than the available bonds outstanding, the number is markedly down from previous month's levels.

That signals some participants have already closed out positions ahead of the auction.

One month ago, RadioShack CDS net notional outstanding totaled US$532m. A year ago, it was over US$1bn.

"Unless you're a holder of both the CDS and the bond, you're probably not thinking you need to hold on to the contract any longer," said Patel. "Investors have kind of gotten the result they expected now, so it appears that people have been reducing positions."

THE PROCESS

The final payout is a two-stage process. First, dealers pool net demand from clients holding CDS positions to determine the 'open interest' for the bonds and provide two-way markets to establish an initial price indication.

In the second phase, market participants have several hours to submit either bids or offers, as required, to clear the open interest. The final price is determined by the price at which the open interest is cleared.

RadioShack filed for Chapter 11 bankruptcy this month. It plans to close 1,700 stores this month and sell 2,400 stores to Standard General, which is also the chain's leading lender.

The restructuring process is expected to be a long, drawn out affair, with unsecured creditors saying the company should have filed for bankruptcy in May when it first planned to close more than 1,000 unprofitable stores. (Reporting by Mike Kentz; Editing by Natalie Harrison and Shankar Ramakrishnan)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

US appeals court decision may speed new payout to Madoff victims

By Jonathan Stempel

NEW YORK Fri Feb 20, 2015 1:46pm EST

NEW YORK Feb 20 (Reuters) - Victims of Bernard Madoff's massive fraud are not entitled to inflation or interest adjustments on their claims, a federal appeals court ruled on Friday, in a decision that could speed the return of more than $1 billion to the swindler's former customers.

Irving Picard, the trustee liquidating Bernard L. Madoff Investment Securities LLC, said he will seek permission from a federal bankruptcy judge to distribute that sum, on top of $7.2 billion paid out so far, as soon as possible.

Picard has kept the additional money in reserve because of litigation over whether former customers deserved "time-based" damages on claims arising from Madoff's Ponzi scheme that was uncovered in 2008.

In Friday's decision, the 2nd U.S. Circuit Court of Appeals in New York said that because the Securities Investor Protection Act, a federal law that helps victims of failed brokerages, did not address such damages, Picard had the flexibility to choose the fairest method to determine the size of valid claims.

Writing for a unanimous three-judge panel, Circuit Judge Chester Straub also said it would be unfair to adjust for inflation and interest the claims of earlier customers, at the expense of later customers.

"Even if all customer property were miraculously recovered, it would be insufficient to satisfy customer claims to the extent such claims were increased to reflect inflation," Straub wrote. "An inflation adjustment to net equity claims could allow some customers to obtain, in effect, a protection from inflation for which they never bargained."

Friday's decision upheld a Sept. 2013 ruling by U.S. Bankruptcy Judge Burton Lifland in Manhattan.

Lifland said Madoff's customers had not bargained for inflation protection or guaranteed returns, and that calculating inflation and interest adjustments would be impossible because their final account statements had been fabricated.

No decision has been made on further appeals.

"It's obviously a disappointment," Greg Schwed, who argued the appeal for some claimants, said in a phone interview.

Amanda Remus, a spokeswoman for Picard, called the decision an "important milestone," saying the only obstacle to the additional payout was a further appeal. Picard is hopeful any further delay would be viewed as "pointless," she said.

Lifland died in January 2014.

Picard has recouped $10.55 billion for Madoff victims who lost an estimated $17.5 billion of principal. Madoff, 76, is serving a 150-year prison term after pleading guilty to running a decades-long fraud.

The case is In re: Bernard L. Madoff Investment Securities LLC, 2nd U.S. Circuit Court of Appeals, No. 14-97. (Reporting by Jonathan Stempel in New York; Editing by Frances Kerry)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

Ivanhoe Energy seeks bankruptcy protection as oil prices weigh

CALGARY, Alberta Fri Feb 20, 2015 4:30pm EST

CALGARY, Alberta Feb 20 (Reuters) - Ivanhoe Energy Inc said on Friday it will seek protection under Canada's Bankruptcy and Insolvency Act, as the company becomes the latest small oil-sands developer to struggle with oil prices that have fallen by more than half since June.

The company has been unable to make a C$2.1 million ($1.7 million) payment on a debenture issue and received a default notice earlier this week for the C$73.3 million issue. Ivanhoe was founded by famed mining investor Robert Friedland, who has lent the company $2.74 million since October.

Ivanhoe is the latest small oil sands developer struggling to survive low oil prices while operating in one of the world's highest-cost regions. It owns the Tamarack thermal oil sands property in northern Alberta and controls another heavy oil property in Ecuador.

Privately held Laricina Energy Ltd said on Friday it would suspend operations at its Germain heavy oil project and put expansions at the site estimated to contain almost 1 billion barrels of tar-like bitumen on hold.

Laricina, which said in October it would seek a buyer, is holding talks with the Canada Pension Plan Investment Board after it failed to meet covenants on a C$150 million note issue.

Under the terms of the Bankruptcy and Insolvency Act, Ivanhoe has up to six months of protection from creditors to restructure its operations. If the company, which had $61.3 million in long-term debt at the end of the third quarter, cannot restructure its operations or find new financing it will become bankrupt.

"The company continues to be actively engaged in discussions with various stakeholders to recapitalize the company," Ivanhoe said in a statement. "Strategic and financial alternatives under consideration are focused on relieving the financial burden of the company's current debt structure and obtaining additional financing necessary to fund ongoing operations."

Ivanhoe shares were halted on the Toronto Stock Exchange. They last traded on Thursday at 87 Canadian cents.

($1 = 1.2535 Canadian dollars) (Reporting by Scott Haggett; Editing by Lisa Shumaker)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

Judge nixes Revel sale, but no sign of bidders

By Daniel Kelley

Thu Feb 19, 2015 6:35pm EST

Feb 19 (Reuters) - A U.S. bankruptcy judge on Thursday terminated the $95.4 million sale of Atlantic City's Revel Hotel and Casino to Florida developer Glenn Straub, clearing a path for a third attempt to sell the troubled property.

Judge Gloria M. Burns in Camden, New Jersey, also ordered that Straub's $10 million deposit be released to Revel's attorneys. They argued that they should be allowed to keep it under the terms of the deal after Straub missed a Feb. 9 deadline to close on the transaction.

But while the ruling allows Revel to accept new bids, it is unclear whether anyone will step up to make a third offer on the distressed New Jersey gambling hub's newest casino, now in its second bankruptcy since it opened in 2012 with a $2.4 billion price tag.

The termination marks the second time a sale of the Revel has failed. Brookfield Asset Management, which won with its $110 million bid late last year, backed away from the deal in November after failing to reach an agreement with the owners of Revel's on-site power plant.

At a hearing earlier in the week, Shaun Martin, Revel's Chief Restructuring Officer, said many investors who have already done due diligence on the property have continued to express interest, but there have been no serious offers.

It's unclear exactly what next awaits Revel, but it is running out of money. If the case lasts another three to five months without a sale, Revel will likely be liquidated, Martin said. It remains unclear what, precisely, that would mean for the property.

Straub's lawyer, Stuart Moskovitz said he would appeal the judge's ruling over the deposit.

Straub had stalled finalizing the purchase, citing litigation involving several businesses that operated inside the casino, including restaurants, a night club and the power plant.

He asked for an extension after those businesses won a series of court victories. The businesses argued that they would be wiped out if the sale proceeded without considering their interests.

Revel's lawyer, John Cunningham said he would ask permission at a later hearing to spend Straub's $10 million deposit. Cunningham said Revel wanted to spend the money "in lieu of further (debtor in possession) financing that we do not have a commitment from Wells Fargo to spend."

Wells Fargo & Co has loaned the resort money to survive during bankruptcy. (Reporting by Daniel Kelley in Trenton, New Jersey; Editing by Christian Plumb)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

Shinsei, Daiwa offer to support Skymark bankruptcy rehab - Kyodo

TOKYO Thu Feb 19, 2015 8:00pm EST

TOKYO Feb 20 (Reuters) - Shinsei Bank Ltd and Daiwa Securities Group Inc have offered to participate in the reconstruction of budget carrier Skymark Airlines Inc including extending possible financial support, Kyodo News reported on Friday.

Airline ANA Holdings Inc and financial services provider Orix Corp have also expressed interest in taking part in the reconstruction, sources have told Reuters.

Skymark last month filed for protection from creditors with total liabilities of about 71 billion yen ($596 million). ($1 = 119.0600 yen) (Tokyo Newsroom)

16.47 | 0 komentar | Read More

PRESS DIGEST- New York Times business news - Feb 20

Fri Feb 20, 2015 12:19am EST

Feb 20 (Reuters) - The following are the top stories on the New York Times business pages. Reuters has not verified these stories and does not vouch for their accuracy.

* Business in both the United States and Hong Kong is being hampered by delays in trans-Pacific shipments of food and festive items. (nyti.ms/1DyBBHx)

* Greece is headed toward a potentially destructive standoff with Europe after Germany rejected a last-minute request on Thursday to extend its loan program. Unless the two sides can bridge their differences, Greece could find itself cut off from its financial lifeline and facing insolvency. (nyti.ms/183uQAv)

* Less than 12 months after investors valued Snapchat at about $10 billion, the start-up is again in the market for money - and poised to nearly double that valuation. (nyti.ms/1Ljau4c)

* Wal-mart Stores Inc, the largest private employer in the country, said that it would increase wages for a half-million employees, a move that comes amid persistent scrutiny of its labor practices and high employee turnover. (nyti.ms/1F0xW2e)

* Wall Street is in a transformation, as bonuses shrink, revenue growth stalls and business lines are cut, driven primarily by regulatory efforts. (nyti.ms/1AqmVGw)

* A federal judge ruled that a longstanding practice by American Express aimed at keeping customers from using other forms of payment violates United States antitrust laws. (nyti.ms/1MD9eKT)

* The Federal Trade Commission filed suit to halt the proposed merger of Sysco Corp's and US Foods Inc, contending that the deal would inflict higher prices and worse service on restaurants, hospitals, hotels, schools and other food service customers. (nyti.ms/1LgWpCz) (Compiled by Zara Mascarenhas in Bengaluru)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

PRESS DIGEST-New York Times business news - Feb 18

Wed Feb 18, 2015 12:56am EST

Feb 18 (Reuters) - The following are the top stories on the New York Times business pages. Reuters has not verified these stories and does not vouch for their accuracy.

* A California nursing home fined by the state for substandard care and facing multiple lawsuits by patients and their families has taken the extreme measure of filing for bankruptcy protection in the face of millions of dollars in potential payouts. (nyti.ms/19uVu5O)

* Many business owners in Greece say relief from austerity measures imposed by foreign creditors will not be enough to reinvigorate growth. (nyti.ms/1AjXUge)

* The Singaporean government's plan to stall a property boom that had become a symbol of inequality has worked only too well. A property sales tax of 18 percent for foreigners has reduced buyers' enthusiasm. (nyti.ms/1zmFQ2m)

* Snapchat is raising a round of venture capital that could value the company at up to $19 billion, according to a person with knowledge of the discussions. (nyti.ms/1MwbxPP)

* Boston Scientific Corp agreed to pay Johnson & Johnson $600 million in connection with Johnson & Johnson's botched acquisition of Guidant, a medical device company, in 2004. (nyti.ms/1yV3fGQ) (Compiled by Zara Mascarenhas in Bengaluru)

16.47 | 0 komentar | Read More

Creditors say RadioShack timed Ch. 11 for hedge fund trade -filing

By Tom Hals

Wed Feb 18, 2015 12:09pm EST

Feb 18 (Reuters) - Unsecured creditors of RadioShack Corp said the electronics retailer timed its bankruptcy to benefit a hedge fund trading strategy even though it cost the company millions of dollars in added losses, according to a court filing.

A committee of the company's landlords, suppliers and bondholders asked the U.S. Bankruptcy Court in Wilmington, Delaware for subpoena power to investigate their suspicions.

They want access to nonpublic information they say could confirm that RadioShack's bankruptcy was an "assisted suicide" led by its largest shareholders, the Standard General hedge fund and LiteSpeed Management.

"The problem is, there's no suicide note, and there are too many unanswered questions," said the filing by the RadioShack's official committee of unsecured creditors, who will only get paid after more senior creditors are paid in full.

RadioShack filed for Chapter 11 bankruptcy this month. It plans to close 1,700 stores this month and sell 2,400 stores to Standard General, which is also the chain's leading lender.

The unsecured creditors said RadioShack should have filed for bankruptcy in May, when it first planned to close more than 1,000 unprofitable stores. That plan was blocked by lenders, and the chain continued to pile up $1 million a day in losses.

The unsecured creditors want to know if Standard General and LiteSpeed used nonpublic information and a financing agreement in October to delay the company's bankruptcy until 2015. The committee asked to take discovery from former directors, officers, advisors and Standard General and LiteSpeed.

The filing says the creditors suspect the hedge funds were working with Standard General, and that if RadioShack had filed for bankruptcy before Dec. 20, the hedge funds would have had to pay out on credit default swaps, a type of credit insurance.

Standard General said the allegations were without merit and it was disappointed the company filed for bankruptcy.

"Our recent proposal to acquire approximately half of the store base is the best chance to preserve the business as a going concern, thereby preserving more than 10,000 jobs and resulting in creditor recoveries substantially above liquidation," said a statement from the hedge fund.

RadioShack did not immediately respond to a request for comment.

The case is In re RadioShack Corp, U.S. Bankruptcy Court, District of Delaware, No. 15-10197 (Reporting by Tom Hals in Wilmington, Delaware; Editing by David Gregorio)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

U.S. regulators give three non-banks more time for living wills

WASHINGTON Wed Feb 18, 2015 3:30pm EST

WASHINGTON Feb 18 (Reuters) - The U.S. Federal Reserve and the Federal Deposit Insurance Corporation gave three non-bank firms more time to submit plans that lay out how they can be wound down through bankruptcy in a crisis, the regulators said on Wednesday.

General Electric Capital Corporation and insurers Prudential Financial and American International Group were given until Dec. 31 of 2015 to submit the so-called living wills, instead of July 1, the regulators said.

The extension was consistent with that provided to other firms in previous years, the regulators said.

The living wills are a crucial part of the 2010 Dodd-Frank Act to reform Wall Street aimed at avoiding another costly taxpayer bail-out of systemically important firms. (Reporting by Douwe Miedema; Editing by Sandra Maler)

16.47 | 0 komentar | Read More

Second dry-bulk shipper files for bankruptcy as rates tumble

Wed Feb 18, 2015 12:08am EST

* Worst dry-bulk cargo market since 1980s - ship owner

* Dozens of iron ore and coal carriers idled

* Baltic dry index falls to all-time low

By Keith Wallis and Henning Gloystein

SINGAPORE Feb 18 (Reuters) - A second dry cargo shipper has filed for bankruptcy following a collapse in freight rates that has forced many companies to idle vessels used to haul iron ore, coal and grain rather than hire out the ships at a loss.

Weaker demand from China and an oversupply of ships has led to the worst industry downturn in 30 years, pushing the Baltic dry index - the industry benchmark for freight rates - to an all-time low.

China's Winland Ocean Shipping Corp filed for Chapter 11 bankruptcy protection in the United States on Feb. 12, court documents show, the second banruptcy this month.

"Due to current market conditions, the financial position of the company and its subsidiaries has deteriorated, leading to immediate difficulties," the document states, adding that it had therefore filed for Chapter 11 protection.

Privately owned Danish firm Copenship filed for bankruptcy earlier in February after losses in the dry bulk market.

"The combination of lower steel demand in China and the huge volume of new tonnage coming on line is what is causing panic and making this the worst bulk market since the mid-1980s," said Hsu Chih-chien, chairman of Hong Kong and Singapore-listed dry bulk shipper Courage Marine.

China's imports tumbled 19.9 percent from a year earlier as its economy grows at its slowest rate in 24 years.

The current freight rate for carrying a cargo of coal in a panamax ship from Indonesia to southern China is about $3,000 per day, compared with more than $6,000 last year. The Baltic dry index has slumped by nearly two-thirds in the past 15 months.

Adding to slowing demand is a swelling fleet, with the number of ordered capesize and panamax carriers for the next three years equal to 39 percent of the existing fleet, according to shipping services firm Clarkson. Yet dry-bulk seaborne trade rose only 4 percent last year.

As a result, dozens of capesize and panamax vessels have been idle around Singapore, Hong Kong and off South Africa's coast, Reuters ship tracking data showed.

Dry-bulkers are not the only shippers in trouble. Over 10 percent of the global liquefied natural gas (LNG) tanker fleet is currently idled after Asian LNG prices fell almost two-thirds since February 2014.

(Additional reporting by Jonathan Saul in London; Editing by Richard Pullin)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

RPT-UPDATE 1-Bank of Portugal, Goldman gear up for legal battle over bank loan

Tue Feb 17, 2015 4:04pm EST

(Repeats to additional subscribers)

By Andrei Khalip

LISBON Feb 17 (Reuters) - The Bank of Portugal on Tuesday stuck to a decision to keep a loan linked to Goldman Sachs in a "bad bank" carved out after the rescue of Banco Espirito Santo (BES), putting the central bank and Goldman Sachs on course for a legal battle.

The central bank said any remaining doubts could only be clarified in court. Goldman responded that it intended "to pursue all appropriate legal remedies without delay".

The Wall Street bank and some of its clients lent BES $835 million in July last year using an entity it created called Oak Finance Luxembourg SA.

The Bank of Portugal rescued BES with a 4.9 billion euro ($5.6 billion) package in August, carving out a working bank, Novo Banco, and a legacy entity that kept the exposure to debts of the bank's founding Espirito Santo family and is being wound down. BES shareholders were left with the "bad bank".

Sources told Reuters last month that Goldman had to write down its loan to BES in the fourth quarter, cutting the bank's profit and some employees' bonuses, after Portugal's central bank effectively wiped out certain creditors.

Goldman would not say how much of the debt it still holds.

The central bank said in a statement on Tuesday the Oak Finance loan was not transferred to Novo Banco because it had "serious and well-grounded reasons to consider that Oak Finance acted for the account of Goldman Sachs International".

"Under the law, loans in these conditions cannot be transferred to a bank in transition," it said, adding that it had analysed objections by Goldman Sachs with the help of an independent external consultant, but the bank was not convinced that Oak Finance was acting independently from Goldman.

A transfer to Novo Banco, it said, would carry "serious risk of irreparable damage to the public interest".

"The arguments presented by Goldman Sachs International did not remove the reasons for doubts on which the Dec. 22 decision was based...Any remaining doubts can only be clarified in court."

A Goldman Sachs spokeswoman said Bank of Portugal's decision not to restore Oak Finance's obligations to Novo Banco "is based on factual errors and violates basic principles of due process and fairness".

"In particular, Goldman Sachs did not hold more than 1.6 percent of the voting rights attached to BES shares. We intend to pursue all appropriate legal remedies without delay."

Goldman had said the central bank and Novo Banco had initially confirmed the transfer of the Oak Finance loan to Novo Banco, but then retroactively returned these obligations, "which damages multiple investors, including pension funds".

($1 = 0.8764 euros) (Reporting By Andrei Khalip; editing by Susan Thomas)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

PRESS DIGEST-New York Times business news - Feb 18

Wed Feb 18, 2015 12:56am EST

Feb 18 (Reuters) - The following are the top stories on the New York Times business pages. Reuters has not verified these stories and does not vouch for their accuracy.

* A California nursing home fined by the state for substandard care and facing multiple lawsuits by patients and their families has taken the extreme measure of filing for bankruptcy protection in the face of millions of dollars in potential payouts. (nyti.ms/19uVu5O)

* Many business owners in Greece say relief from austerity measures imposed by foreign creditors will not be enough to reinvigorate growth. (nyti.ms/1AjXUge)

* The Singaporean government's plan to stall a property boom that had become a symbol of inequality has worked only too well. A property sales tax of 18 percent for foreigners has reduced buyers' enthusiasm. (nyti.ms/1zmFQ2m)

* Snapchat is raising a round of venture capital that could value the company at up to $19 billion, according to a person with knowledge of the discussions. (nyti.ms/1MwbxPP)

* Boston Scientific Corp agreed to pay Johnson & Johnson $600 million in connection with Johnson & Johnson's botched acquisition of Guidant, a medical device company, in 2004. (nyti.ms/1yV3fGQ) (Compiled by Zara Mascarenhas in Bengaluru)

16.47 | 0 komentar | Read More

BRIEF-Alert Steel says business rescue practitioner awaiting payment

Mon Feb 16, 2015 3:25am EST

* Business rescue practitioner is currently awaiting payment for business rescue fees and expenses

* Upon payment of fees and expenses, co should no longer be in financial distress after which business rescue proceedings will be terminated Source text for Eikon: Further company coverage:

16.47 | 0 komentar | Read More

Bank of Portugal keeps 15 potential bidders in race for Novo Banco

LISBON Mon Feb 16, 2015 6:42am EST

LISBON Feb 16 (Reuters) - The Bank of Portugal has trimmed down the list of potential bidders for Novo Banco - the successor to Banco Espirito Santo after a state rescue - saying that 15 out of 17 institutions that had expressed interest in the sale met its requirements.

The central bank said in a statement on Monday it asked the 15 pre-qualified institutions to sign a confidentiality agreement, after which they will have until March 20 to present non-binding offers. It did not provide any names or details.

Last August, the state rescued the bank with a 4.9 billion euro package, mostly in public funds, after the business empire of the bank's founding Espirito Santo family collapsed. The state plans to sell Novo Banco this year to recover the rescue funds.

So far, Portugal's Banco BPI and Spain's Santander and Banco Popular have publicly said they are interested in Novo Banco. Local media have said that China's Fosun and U.S. private equity firm Apollo Global Management have also expressed interest. (Reporting By Andrei Khalip)

16.47 | 0 komentar | Read More

Orix considering support for Skymark Airlines - Kyodo

TOKYO Tue Feb 17, 2015 12:19am EST

TOKYO Feb 17 (Reuters) - Orix Corp is considering offering support for Skymark Airlines Inc, which in late January filed for bankruptcy protection, Kyodo News reported on Tuesday.

Skymark is seeking other sponsors alongside investment fund Integral Corp to help turn its business around, Skymark and Integral said earlier this month.

16.47 | 0 komentar | Read More

BRIEF-Amper reports at end of October 2014 loss of 21.4 mln euros

Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests.

NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

16.47 | 0 komentar | Read More

BRIEF-Ciccolella receives judgement from Court in Trani

Mon Feb 16, 2015 1:34am EST

* Reported on Friday it has been notified that the Court in Trani has declared the bankruptcy proceedings of the company in its judgement from Feb. 10

* The court has appointed Gennaro Acclavio and Vincenzo Civita as company's curators

* The company intends to appeal against that judgement Source text for Eikon: Further company coverage:

16.47 | 0 komentar | Read More

BRIEF-Alert Steel says business rescue practitioner awaiting payment

Mon Feb 16, 2015 3:25am EST

* Business rescue practitioner is currently awaiting payment for business rescue fees and expenses

* Upon payment of fees and expenses, co should no longer be in financial distress after which business rescue proceedings will be terminated Source text for Eikon: Further company coverage:

16.47 | 0 komentar | Read More

AT1 market set to shine despite steep supply

By Alice Gledhill

Fri Feb 13, 2015 11:57am EST

LONDON, Feb 13 (IFR) - Investors that have been left with few options but to pile into riskier assets in order to pick up some yield are expected to give strong support to the Additional Tier 1 market, which is expected to grow further in 2015.

UBS was the fourth bank to join the fray this week with an inaugural triple-tranche offering, and further deals from Nykredit and Svenska Handelsbanken expected in the coming days.

And this is just the tip of the iceberg with European bank issuance volumes expected to hit EUR65bn-equivalent in 2015, according to Morgan Stanley's figures.

"Once QE actually starts and yield/returns grind out of other sectors, CoCos which yield north of 5% will inevitably look cheap," said Chris Telfer, portfolio manager at ECM.

"In order to chase yield and increase diversification, portfolio mandates will likely change over the next six months to allow for increased non-investment grade credit allocations, particularly after S&P downgraded Lower Tier 2 financial bonds in Q4 and CoCos become a larger part of the market."

The European Central Bank's announcement in January that it would buy as much as EUR60bn of assets from March until at least September 2016 is providing much needed support for the market at a time where the excitement of the first deals has well and truly died down.

"The market for AT1s is more mature and the investor base is certainly wider than a year ago - this helps to absorb the new supply," said Eoin Walsh, portfolio manager at 24 Asset Management.

And with capital buffers and capital quality improving across the board, AT1s from a broader range of issuers will look increasingly appealing.

The solid demand for this week's dollar issue from Swedbank - the highest capitalised bank in Europe with a 21.2% Common Equity Tier 1 ratio - provided further proof that the strength of banks' balance sheets is a key consideration for investors.

CHOPPY WATERS

But while the long-term outlook looks rosy, the success of individual deals still rests on the ability of syndicates to navigate a range of constraints.

The recent flurry of deals, for example, showed that competing supply can weigh on the execution process. Leads on Danske's BB+/BB+ rated deal flagged some price sensitivity in the book, which investors attributed to Swedbank's investment-grade inaugural offering waiting in the wings.

"It's a good time to issue after results and the market is looking firm, but there may be a level of indigestion if there are too many at the same time. That BBVA opened wider may be an indication of this," said one investor.

BBVA posted one of the biggest books of the week for its euro 6.75% perpetual non-call five bond, but the deal languished in the secondary market and was bid over 7% on Friday afternoon.

Furthermore, repeat issuers such as BBVA may need to pay slightly more premium given the expectation of further supply, the investor said, although this is unlikely to be more than 25bp.

Issuers with lofty size aspirations may also have to pay up, warned a banker. "If you want to take out real size, for example EUR1.5bn, you will need to pay a bigger premium."

Moreover, volatility in the asset class has put off some investors.

"Some investors such as hedge funds tend to inflate orders for hot deals, and they are absent in order books in trickier transactions or on days of less clarity," said Per Høg Jensen, head of financial origination at Danske Bank.

But bankers said this may be no bad thing as the paper remains in the hands of long-term holders - and from an issuer's perspective, the deal still gets done.

But Jensen added that market-making in AT1 instruments has become much more fragile, which can catalyse an initial softening. "You will find that some lead managers are not there to support transactions now." (Reporting by Alice Gledhill, Editing by Helene Durand, Julian Baker)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

U.S. House panel to hear proposal for Puerto Rico bankruptcy protection

Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests.

NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

16.47 | 0 komentar | Read More

Dubai World has 100 pct creditor assent for $14.6 bln debt deal -court

DUBAI Sun Feb 15, 2015 2:24am EST

DUBAI Feb 15 (Reuters) - State-owned conglomerate Dubai World has received approval from all creditors for a $14.6 billion restructuring plan, and the court administering the process has been adjourned until May 10, according to court proceedings on Sunday.

The adjournment, ordered by Sir Anthony Evans, chairman of the Dubai World Tribunal, will allow time for all creditors to sign an agreement which formally pledges each will assent to the plan put forward by Dubai World.

Dubai World entered the tribunal process last month after passing the threshold needed to change the terms of its existing restructuring. (Reporting by Tom Arnold; Writing by David French; editing by John Stonestreet)

16.47 | 0 komentar | Read More

AT1 market set to shine despite steep supply

By Alice Gledhill

Fri Feb 13, 2015 11:57am EST

LONDON, Feb 13 (IFR) - Investors that have been left with few options but to pile into riskier assets in order to pick up some yield are expected to give strong support to the Additional Tier 1 market, which is expected to grow further in 2015.

UBS was the fourth bank to join the fray this week with an inaugural triple-tranche offering, and further deals from Nykredit and Svenska Handelsbanken expected in the coming days.

And this is just the tip of the iceberg with European bank issuance volumes expected to hit EUR65bn-equivalent in 2015, according to Morgan Stanley's figures.

"Once QE actually starts and yield/returns grind out of other sectors, CoCos which yield north of 5% will inevitably look cheap," said Chris Telfer, portfolio manager at ECM.

"In order to chase yield and increase diversification, portfolio mandates will likely change over the next six months to allow for increased non-investment grade credit allocations, particularly after S&P downgraded Lower Tier 2 financial bonds in Q4 and CoCos become a larger part of the market."

The European Central Bank's announcement in January that it would buy as much as EUR60bn of assets from March until at least September 2016 is providing much needed support for the market at a time where the excitement of the first deals has well and truly died down.

"The market for AT1s is more mature and the investor base is certainly wider than a year ago - this helps to absorb the new supply," said Eoin Walsh, portfolio manager at 24 Asset Management.

And with capital buffers and capital quality improving across the board, AT1s from a broader range of issuers will look increasingly appealing.

The solid demand for this week's dollar issue from Swedbank - the highest capitalised bank in Europe with a 21.2% Common Equity Tier 1 ratio - provided further proof that the strength of banks' balance sheets is a key consideration for investors.

CHOPPY WATERS

But while the long-term outlook looks rosy, the success of individual deals still rests on the ability of syndicates to navigate a range of constraints.

The recent flurry of deals, for example, showed that competing supply can weigh on the execution process. Leads on Danske's BB+/BB+ rated deal flagged some price sensitivity in the book, which investors attributed to Swedbank's investment-grade inaugural offering waiting in the wings.

"It's a good time to issue after results and the market is looking firm, but there may be a level of indigestion if there are too many at the same time. That BBVA opened wider may be an indication of this," said one investor.

BBVA posted one of the biggest books of the week for its euro 6.75% perpetual non-call five bond, but the deal languished in the secondary market and was bid over 7% on Friday afternoon.

Furthermore, repeat issuers such as BBVA may need to pay slightly more premium given the expectation of further supply, the investor said, although this is unlikely to be more than 25bp.

Issuers with lofty size aspirations may also have to pay up, warned a banker. "If you want to take out real size, for example EUR1.5bn, you will need to pay a bigger premium."

Moreover, volatility in the asset class has put off some investors.

"Some investors such as hedge funds tend to inflate orders for hot deals, and they are absent in order books in trickier transactions or on days of less clarity," said Per Høg Jensen, head of financial origination at Danske Bank.

But bankers said this may be no bad thing as the paper remains in the hands of long-term holders - and from an issuer's perspective, the deal still gets done.

But Jensen added that market-making in AT1 instruments has become much more fragile, which can catalyse an initial softening. "You will find that some lead managers are not there to support transactions now." (Reporting by Alice Gledhill, Editing by Helene Durand, Julian Baker)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

Bankrupt OW Bunker subsidiary owed $329 mln

SINGAPORE Fri Feb 13, 2015 9:46am EST

SINGAPORE Feb 13 (Reuters) - Dynamic Oil Trading (Singapore), a subsidiary of bankrupt ship fuel supplier OW Bunker, is owed $329 million and its liquidators said on Friday they are investigating the company's dealings with another Singapore-based marine fuel firm.

OW Bunker, once the leading supplier of marine fuel oil with a 7 percent market share, filed for bankruptcy in Denmark in November after revealing losses of at least $125 million at Dynamic Oil Trading.

In a statement issued on Friday, Dynamic Oil Trading's official liquidators from KPMG said it had an estimated $329 million in gross receivables due, and they are investigating its dealings with Tankoil Marine, which is its largest debtor.

"The Liquidators were, however, not in a position at this preliminary stage to comment further on the matter," the statement read.

"(KPMG) will also be looking to work closely with the Trustees of O.W. Bunker A/S to gain full access to DOT Singapore's records maintained in Denmark."

OW Bunker's board said earlier that it had not approved a credit line estimated at between $120 million and $130 million given by Dynamic Oil Trading to Tankoil Marine.

Tankoil Marine was not immediately available for comment.

Singapore port authorities revoked the bunker supplier and operator licences of Tankoil Marine earlier this week saying they had found discrepancies and wrongful declarations in company's records kept on board its bunker tankers.

Dynamic Oil Trading's largest secured creditor is ING Bank N.V. (ING) and the company has over 100 unsecured creditors to whom it owes an estimated $198 million, according to the statement. (Reporting by Jessica Jaganathan; Editing by Mark Potter)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More

UBS finds deep pockets for riskiest CoCo yet

By Helene Durand

Fri Feb 13, 2015 10:53am EST

LONDON, Feb 13 (IFR) - UBS has uncovered deep pockets of demand for the riskiest CoCo structure yet after investors shrugged off warnings about the impact on profit of the surging Swiss franc and negative interest rates this week.

The Swiss lender will price over USD3.4bn-equivalent of AT1 later on Friday, USD1.15bn of which are bonds that can be totally written off if the bank's Common Equity Tier 1 ratio falls below 7%.

High-trigger total-loss CoCos have been issued before - by Barclays and Credit Agricole - but those were less subordinated Tier 2 capital.

This riskiest tranche will allow UBS to free up some equity. Under Swiss rules aimed at ending too big to fail, the bank can hold 3% of its risk-weighted assets in high-trigger CoCo bonds instead of equity.

UBS was badly hit during the financial crisis but has turned things around in recent years. The bank reported a 13.4% fully applied Basel 3 Common Equity Tier 1 ratio at the end of last year, among the highest among large global banks.

UBS is also selling two lower-trigger bonds, for USD1.15bn and EUR1bn, which can be written off permanently if the bank's Common Equity Tier 1 ratio falls below 5.125%. It is the first time that a bank has sold low-trigger bonds alongside high-trigger ones.

These AT1s not only help the bank meet low-trigger loss absorbing capital requirements but also help boost its leverage ratio.

STRONG RESPONSE

The strong response to the deal comes after a week of heavy supply in the bank capital market and amid expectations of more deals to come.

Demand across the three tranches reached over USD15bn-equivalent, allowing UBS to revise pricing tighter.

Guidance on the dollar perpetual non-call five high-trigger deal moved from 7.25% area to 7.125% on books over USD4.5bn.

Guidance on the low-trigger USD1.15bn perpetual non-call 10-year tranche was revised from 7.125% area to 7% on books over USD5.25bn.

Meanwhile, the EUR1bn perpetual non-call seven will price at 5.75%, tighter than guidance of 5.875% to 6% on books over EUR4.7bn. (Reporting by Helene Durand, Editing by Alex Chambers, Julian Baker)

• Link this
• Share this
• Digg this
• Email
• Print
• Reprints

16.47 | 0 komentar | Read More