BP (NYSE:BP) may stick their potential asset buyers with lawsuits, said lawyers. As the company continues its attempt to raise money to help pay legal claims that some are estimating could reach over $100 billion.
There are certain laws in place that could prohibit fraudulent transfers, allowing victims to sue a buyer to get money to pay claims. Which would leave the purchaser required to pay BP's obligations, if the company files for bankruptcy. Although there could be a change to federal bankruptcy laws, if approved could make a buyer wait for BP's approval from victims for the sale. The other option being to convince a judge that the company has sufficient assets to pay all legal claims in full.
New York bankruptcy lawyer, Martin Bienenstock of Dewey of Leboeuf LLP said, "Any purchaser will worry about fraudulent transfer and successor liability issues and perhaps request part of the purchase price be kept in escrow for such a contingency."
Showing posts with label Bankruptcy. Show all posts
Showing posts with label Bankruptcy. Show all posts
Friday, July 16, 2010
Friday, June 25, 2010
BP (NYSE:BP) Stock Price Reaches All Time Low
Due to concerns continuing to mount about BP's (NYSE:BP) future, there is added pressure on oil and gas stocks by the New York stock oil futures. These losses came after BP announced that it has to date spent $2.35 billion. This money has went to various things including the oil cleanup efforts, legal claims that have been paid, and grants to the states on the Gulf that have seen the biggest impact since the April 20th rig disaster.
The other thing that is causing renewed concern and placing pressure on BP stocks, is the pending development of a tropical storm. If this storm hits the Gulf of Mexico as predicted, it will cause possible large delays in the fuel containment efforts. Broker Nomura cut it projected BP price target from 593p to 465p.
Nomura said, "a heavy inversion of both credit yield and equity volatility suggests the market is concerned about a near term credit event around BP." BP stock fell to $26.96 a share losing another 6.1 percent. This beating their prior day low of $28.56, losing a total market value of almost 53 percent since April 20th.
"BP's market cap is eroding and its ability to finance itself in the capital market is impaired. It's anybodies guess what can happen but the fear of the market is that that liability could be so enormous that BP may have to seek bankruptcy protection," said Orr.
The other thing that is causing renewed concern and placing pressure on BP stocks, is the pending development of a tropical storm. If this storm hits the Gulf of Mexico as predicted, it will cause possible large delays in the fuel containment efforts. Broker Nomura cut it projected BP price target from 593p to 465p.
Nomura said, "a heavy inversion of both credit yield and equity volatility suggests the market is concerned about a near term credit event around BP." BP stock fell to $26.96 a share losing another 6.1 percent. This beating their prior day low of $28.56, losing a total market value of almost 53 percent since April 20th.
"BP's market cap is eroding and its ability to finance itself in the capital market is impaired. It's anybodies guess what can happen but the fear of the market is that that liability could be so enormous that BP may have to seek bankruptcy protection," said Orr.
Thursday, June 10, 2010
Pacific Ethanol (Nasdaq:PEIX) May Reopen Two Idle Plants
Pacific Ethanol (Nasdaq:PEIX) announced recently it is reorganizing the company in order to bring its four production subsidiaries out of bankruptcy.
They opened up the Magic Valley plant located in Idaho earlier in the year, and have plans to open up two more idled ethanol plants soon.
Lenders have already approved of the reorganization plan, and the two idled plants, which are both located in California, may resume production by the end of June.
Pacific Ethanol will be allowed to acquire up to 25 percent of the overall ownership in the new holding company, which has the subsidiaries transferred to it. The cost will be up to $30 million in cash.
Two plants wholly owned by Pacific are now operational - one in Boardman, Oregon, and the other in Burley, Idaho.
Combined they can produce up to 100 million of ethanol annually.
They opened up the Magic Valley plant located in Idaho earlier in the year, and have plans to open up two more idled ethanol plants soon.
Lenders have already approved of the reorganization plan, and the two idled plants, which are both located in California, may resume production by the end of June.
Pacific Ethanol will be allowed to acquire up to 25 percent of the overall ownership in the new holding company, which has the subsidiaries transferred to it. The cost will be up to $30 million in cash.
Two plants wholly owned by Pacific are now operational - one in Boardman, Oregon, and the other in Burley, Idaho.
Combined they can produce up to 100 million of ethanol annually.
Thursday, January 15, 2009
"Show Me Ethanol" Close to Filing Bankruptcy
Show Me Ethanol of Missouri is one step away from filing bankruptcy, as it has asked it shareholders for more funding via a capital call of $4,800 a share and a voluntary capital contribution.
If they can't raise the additional funds, the company will be forced to file for Chapter 11 bankruptcy.
Let it die!
If they can't raise the additional funds, the company will be forced to file for Chapter 11 bankruptcy.
Let it die!
Wednesday, January 14, 2009
Another Waste of Taxpayers Money as Northeast Biofuels Files for Chapter 11 Bankruptcy
Only a mere five months after becoming operational, Northeast Biofuels LP has already sought out bankuptcy protection under Chapter 11.
Businesses filing under Chapter 11 restructure their finances with the goal of starting operations up again.
The plant cost about $200 million to build, as another huge waste of taxpayers' money is revealed in the ongoing ethanol debacle.
Go here for bankruptcy petition, which was filed in U.S. Bankruptcy Court in Syracuse
Friday, November 21, 2008
VeraSun Energy Requests Permission to Void Corn Contracts with 10-day Notice
Farmers are up in arms over the request by VeraSun Energy for a Delaware judge to give them permission to void corn contracts with a notice of 10 days.
The arguments by farmers was the action would take away their ability to sell corn to other potential buyers, while at the same time essentially killing expected revenue.
Because farmers have a contract with VeraSun, they would have to legally hold the corn until the they find out if VeraSun was continuing the contract, hindering them from lining up another buyer until a notice is officially received.
I don't have much sympathy for the farmers in this situation, as the farmers didn't mind lining their pockets with taxpayer subsidies for corn-based ethanol. When all you do is continue to beg at the government trough, and not become good at business, this is the risk you'll always take.
With the filing of the bankruptcy in Delaware, any agricultural organization or farmer would probably have to travel to the state to get legal counsel recognized by the government there. As of early Friday there hadn't been any objections filed in the case. Claiments had until 4 p.m. Friday to file.
On the 2nd of December the request by VeraSun will be reviewed at a hearing.
The entire ethanol fiasco needs to be abandoned, as it is a grotesque failure that continues to be one of the most idiotic wastes of time, energy and money.
For the quarter ending September 30, VeraSun reported a net loss of $476.1 million.
The arguments by farmers was the action would take away their ability to sell corn to other potential buyers, while at the same time essentially killing expected revenue.
Because farmers have a contract with VeraSun, they would have to legally hold the corn until the they find out if VeraSun was continuing the contract, hindering them from lining up another buyer until a notice is officially received.
I don't have much sympathy for the farmers in this situation, as the farmers didn't mind lining their pockets with taxpayer subsidies for corn-based ethanol. When all you do is continue to beg at the government trough, and not become good at business, this is the risk you'll always take.
With the filing of the bankruptcy in Delaware, any agricultural organization or farmer would probably have to travel to the state to get legal counsel recognized by the government there. As of early Friday there hadn't been any objections filed in the case. Claiments had until 4 p.m. Friday to file.
On the 2nd of December the request by VeraSun will be reviewed at a hearing.
The entire ethanol fiasco needs to be abandoned, as it is a grotesque failure that continues to be one of the most idiotic wastes of time, energy and money.
For the quarter ending September 30, VeraSun reported a net loss of $476.1 million.
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