Karen's Feed
Sep 4, 2014

Detroit bankruptcy plan a ‘road map’ that may need adjustment -city’s CFO

DETROIT, Sept 4 (Reuters) – Detroit’s chief financial
officer took the stand on Thursday as the first witness in the
city’s historic bankruptcy hearing, testifying that while he
believed Detroit’s debt adjustment plan can be implemented, it
cannot be set in stone.

“Initially, we definitely believe the plan gives us a road
map to how we should be operating,” said John Hill, who was
appointed CFO last November.

Sep 3, 2014

Detroit, creditors lay groundwork for fight over bankruptcy plan

DETROIT, Sept 3 (Reuters) – Detroit claimed on Wednesday
that its plan to adjust its debt and exit bankruptcy is feasible
and fair to creditors, but a bond insurance company contended
the plan calls for “historic levels of discrimination” among
creditors.

Bruce Bennett, a Jones Day attorney representing Detroit,
wrapped up his three-hour opening statement by disputing
arguments from creditors who claim the city’s plan to adjust its
$18 billion in debt is inadequate and should be scrapped.

Sep 3, 2014

Judge puts off decision on Detroit water shutoffs, orders mediation

DETROIT, Sept 3 (Reuters) – A federal bankruptcy judge has
ordered Detroit and civil rights attorneys into two weeks of
confidential mediation over the city’s practice of shutting off
water to residents with unpaid bills.

Federal Bankruptcy Judge Steven Rhodes will announce on
Sept. 17 whether he will issue a temporary restraining order on
Detroit’s controversial attempt to reduce its $90 million
backlog of unpaid water bills, according to an order signed on
Tuesday and publicly released on Wednesday.

Sep 3, 2014

Key hearing on Detroit’s historic bankruptcy begins in U.S. court

DETROIT (Reuters) – Detroit will not recover, and it may not survive as a major city if its debts are not significantly reduced during bankruptcy, a city attorney told a federal judge at the start of a critical phase of the case on Tuesday.

As Detroit’s state-appointed emergency manager Kevyn Orr looked on in the courtroom, Bruce Bennett, an attorney for the city, sought to convince Judge Steven Rhodes that Detroit’s 1,034-page plan to adjust $18 billion of debt would save the city.

Sep 2, 2014

Key hearing on Detroit’s historic bankruptcy begins in federal court

DETROIT (Reuters) – The key hearing on the biggest municipal bankruptcy in U.S. history started on Tuesday in a federal courtroom, where teams of attorneys began laying out arguments over Detroit’s plan to adjust $18 billion of its debt.

Detroit made history nearly 14 months ago when it filed for bankruptcy. The confirmation hearing on the city’s plan to exit bankruptcy is now scheduled to stretch through Oct. 17.

Aug 27, 2014

Bankrupt Detroit offered bigger loan secured by art

By Karen Pierog

(Reuters) – A New York-based specialty finance group is ready to loan Detroit as much as $4 billion, double its previous offer, if the bankrupt city uses the masterpieces in its art museum as collateral, according to a new proposal that surfaced this week.

Art Capital Group, which offered to loan the city $2 billion earlier this year, doubled the offer based on a recent appraisal that determined the Detroit Institute of Arts’ (DIA) collection was worth more than $8 billion.

Aug 13, 2014

Start of Detroit bankruptcy trial pushed to Aug. 29

Aug 13 (Reuters) – A federal judge on Wednesday once again
delayed the start of the key phase of Detroit’s historic
bankruptcy case, pushing it to Aug. 29 from Aug. 21.

U.S. Bankruptcy Judge Steven Rhodes on Tuesday had raised
the possibility that the confirmation trial, on Detroit’s plan
to adjust $18 billion of debt and exit the biggest-ever
municipal bankruptcy, may be delayed to allow time for the city
to incorporate a major settlement over $5.2 billion of water and
sewer revenue bonds into the plan.

Aug 12, 2014

Water deal could force another delay in Detroit bankruptcy trial

By Lisa Lambert and Karen Pierog

(Reuters) – A federal judge could once again push back the start date for the trial on Detroit’s exit from the largest municipal bankruptcy in U.S. history after some creditors said on Tuesday a possible settlement is snarling key components of the restructuring plan.

The complicated settlement rests on a tender offer for $5.2 billion of the city’s water and sewer revenue bonds. The deadline for bondholders to tender their debt voluntarily for repurchase is Aug. 21, the same day the trial is to begin, with the final settlement possibly becoming firm weeks later, in the middle of the proceeding.

Jul 25, 2014

Detroit’s revised bankruptcy plan sheds light on bonds, monitor

July 25 (Reuters) – Detroit released a revised debt
adjustment plan on Friday that details the role of a
post-bankruptcy monitor and sets up a reserve fund to possibly
enhance recoveries for certain creditors.

The fifth revision of the plan filed in U.S. Bankruptcy
Court creates a litigation trust related to Detroit’s lawsuit
seeking to void $1.45 billion of pension certificates of
participation (COPs) sold in 2005 and 2006.

Jul 25, 2014

Detroit revs up for approval of bankruptcy plan

July 25 (Reuters) – Detroit could be on the fast track to
complete the final, crucial phase of its historic bankruptcy
case, as settlements with key creditors line up and city workers
and retirees demonstrate overwhelming support for cost-saving
retirement benefit changes.

While a small, hard-core group of creditors continues to
hold out for a better deal, the support among workers and
retirees may help push through the city’s plan to adjust $18
billion of debt and exit the biggest Chapter 9 municipal
bankruptcy in U.S. history. It has moved the possibility of a
“cram down,” where a bankruptcy plan is imposed on objecting
creditors, to center stage.