CIT Group Files Bankruptcy Under Debt Reduction Plan

November 2, 2009 by · 1 Comment
Filed under: Legal News 

No surprise that CIT is finally restructuring their debt, hopefully they can become a viable business finance company that can rely more on long-term financing then the more short and medium term financing.  According to Bloomberg, they are looking to refinance $10 billion dollars of debt.  This bankruptcy makes it the 5th largest in U.S. history at $71 billion dollars in assets against which it has $64.9 billion in liabilities.

CIT Group Inc., the 101-year-old commercial lender that saw its funding dry up in the credit crunch, filed for bankruptcy in an effort to cut $10 billion in debt following a failed debt exchange and U.S. taxpayer bailout.

CIT listed $71 billion in assets and $64.9 billion in liabilities in a Chapter 11 petition yesterday in U.S. Bankruptcy Court in Manhattan. The Treasury Department said the government probably won’t recover much, if any, of the $2.3 billion in taxpayer money that went to CIT.

The lender, which funds about 1 million businesses such as Dunkin’ Brands Inc. and Eddie Bauer Holdings Inc., plans to exit court protection next month after bondholders voted in favor of a “prepackaged” plan. None of CIT’s operating subsidiaries, including Utah-based CIT Bank, were included in the filing, and operations will proceed as normal, CIT said in a statement.

“Short term, it’s going to cause some difficulties for startups and smaller borrowers,” said Jean Everett, a partner at Hiscock & Barclay LLP focusing on financial institutions and lending. “CIT lent across so many sectors, it’s sort of difficult to predict how it’ll affect each sector.”

Source: Bloomberg

Lehman Brothers bankruptcy filing may have wiped out $75 billion from creditors

December 29, 2008 by · Leave a Comment
Filed under: Stock Market News 

No doubt everyone looking back will think that Lehman should of been saved from their current fate but that is now in the past and we have to deal with the current situation.  I think some hard questions will need to be answered when we look early in this meltdown on why certain companies were saved when others were not even days apart?  I am suprised no real criminal investigation have really been announced other than Madoff.

News:

Lehman Brothers Holdings Inc’s emergency bankruptcy filing wiped out as much as $75 billion of potential value for creditors, The Wall Street Journal reported on Monday, citing an analysis by the bank’s restructuring advisers.

A more planned and orderly filing would have allowed Lehman to sell some assets outside of bankruptcy court protection and would have given it time to unwind derivatives positions, according to the analysis by Alvarez & Marsal.

Read more

Tribune newspaper files for bankruptcy protection from creditors

December 8, 2008 by · Leave a Comment
Filed under: Stock Market News 

It will be likely to see more of these private equity deals fall apart and it up in bankruptcy as well. Sam Zell must not be happy about this turn of events. It is interesting that they talk about “de-leveraging” in this press release. Something tells me that this might not be a Recession but in reality a very real Depression. The stock market is sending mixed signals, with the amount of bad news coming out, it is surprising that the market is not only where it is at but actually gaining. Maybe some of these liquidity is seeping into the stock market?

News:

The publisher of the Chicago Tribune and the Los Angeles Times declared bankruptcy on Monday as the U.S. newspaper industry’s unrelenting loss of readers and advertisers claimed its biggest victim yet.

Tribune Co, which owns eight major daily newspapers and several television stations, filed for Chapter 11 bankruptcy protection after collapsing under a heavy debt load just a year after real estate mogul Sam Zell took it private.

Read more

Post-default liquidation now more likely in corporate bankruptcies

October 26, 2008 by · Leave a Comment
Filed under: Industry News 

This is a happy article, it talks about this environment being unforgiving for companies that have to go into receivership.  It is normal that we will see more liquidation than restructuring.  I want to see more failures that rescues, if it is warranted than that is the normal working of a free-market enterprise system.

Press Release:

Companies that file for bankruptcy are more likely to be forced into liquidation in the current environment as the availability of financing for restructuring has dried up, Standard & Poor’s said on Thursday.

Read more

WaMu may file for bankruptcy shortly according to Merrill Lynch analyst

September 26, 2008 by · Leave a Comment
Filed under: Industry News 

Now it looks like its time to seek protection from their creditors. I feel very bad for anyone who put money in this company during the last 6 months. It is sad they could not get the capital they need to weather the storm.

Press Release:

Washington Mutual may file for bankruptcy shortly, said Merrill Lynch analyst Kenneth Bruce terminating coverage of the stock.

The top U.S. savings and loan bank, whose market value has been virtually wiped out because of soaring mortgage losses, was closed by regulators on Thursday, and its banking assets were sold to JPMorgan Chase & Co or $1.9 billion.

The company witnessed $16.7 billion in deposit outflows from September 15 to September 24, according to an Office of Thrift Supervision statement.

“We suspect the series of ratings downgrades and concerns over the position of U.S. financial institutions, in particular Washington Mutual, led to the deposits outflow,” Bruce said.

Shares of Washington Mutual sank 90 percent to 16 cents in morning trade Thursday.

Source: Reuters

« Previous PageNext Page »