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Bankruptcy & Restructuring 2012 Review and 2013 Outlook
 

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Outlook For 2013 Restructurings, Review of 2012 Bankruptcies. ...

Outlook For 2013 Restructurings, Review of 2012 Bankruptcies.
Bankruptcy professionals expect restructurings for retailers, restaurants, real estate businesses and coal companies in 2013. Bond and loan recoveries of 2012, and a map of the year’s Chapter 11 filings and single asset real estate bankruptcies. This is a sample of Bloomberg's market leading Bankruptcy and Restructuring newsletter. For more information or a free trial visit bloombergbriefs.com or call Annie on 212 617 0544

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Bankruptcy & Restructuring 2012 Review and 2013 Outlook Bankruptcy & Restructuring 2012 Review and 2013 Outlook Document Transcript

  • bANKRUPTCY &RESTRUCTURING 2012 Review & 2013 outlook January 2013
  • 01.03.13 www.bloombergbriefs.com Bloomberg Brief | Bankruptcy Restructuring 2Contents year in review click on orange triangles for interactive featuresVoicesBankruptcy professionals expect restructuring activity for retailers, res- MONTH ACTIONStaurants, real estate businesses and coal companies in 2013. Problemsin Europe could bring about more Chapter 15 petitions. Jan. 11: Hostess Brands’ second bankruptcy lists debt of more than $1 billion. Jan. 17: Enron creditors get 53% payout.Page 3 & 4 JAN Jan. 17: Fitch says Greece is insolvent and it will default. Jan. 19: Eastman Kodak files Chapter 11 in New York’s southern district.Bond and Loan recoveries Jan. 19: Energy Future Holdings swaps show 91 percent chance of default.General Maritime had the biggest disparity in recovery rates for lend-ers and bondholders among companies filing disclosure statements in Feb. 6: AMR CEO says willing to weigh acquisitions after bankruptcy exit.2012. Feb. 8: Lancaster Maritime New York Chapter 11 lists $500 million in debt.Pages 5 & 6 Feb. 14: Teamsters warn of strike if Hostess imposes “unfair contract terms” as part FEB of its bankruptcy process.Map of 2012 Chapter 11 Activity Feb. 17: WaMu judge says she will confirm Chapter 11 plan. Feb. 20: Grubb & Ellis agrees to sell itself in bankruptcy.California, Florida and Texas bankruptcy courts were the most activevenues for bankruptcy filings for businesses with debt of more than $1 Mar 14: A&P exits as private grocery chain.million. Mar 20: Humpuss Sea Transport files Chapter 15.Page 7 MAR Mar 26: Nancy Hershey Lord sworn in as a judge in the Eastern District of New York. Paul R. Warren sworn in as Rochester judge.LARGEST CHAPTER 11 PETITIONSPage 8 & 9 April 5: Phil Falcone says bankruptcy an option for LightSquared. Detroit accepts state plan to head off bankruptcy.Single Asset real estate activity APR April 27: FGIC plan confirmed. Cash distribution to unsecured creditors said to beSingle asset real estate petitions made up a quarter of all bankruptcy between 5.5 percent and 6 percent. April 30: Ally says losses could reach $1.25 billion if ResCap goes bankrupt.petitions from businesses involving debt of $1 million or more in 2012.Page 10 May 11: Houghton Mifflin says it will file prepackaged bankruptcy to eliminate $3.1 billion worth of debt.Chapter 9 Petition ACTIVITY May 14: Residential Capital files bankruptcy in New York’s southern district.Bankruptcy filings from local governments declined in 2012 from 2011. MAY May 16: Harrisburg city counsel loses effort to reinstate bankruptcy.Page 11 May 29: U.S. Supreme Court rules a secured creditor can force a bankrupt company to hold an auction where lenders may bid secured debt rather than cash.Chapter 15 filingsCanada was the largest source of Chapter 15s in 2012. June 6: Stockton city council authorizes bankruptcy.Page 12 JUN June 11: AMR says it wants to restructure as independent business.Post petition bond pricesCharting the performance of MF Global, American Airlines, NewPage July 3: Mammoth Lakes, Calif., says it plans Chapter 9 filing.and Patriot Coal bonds in 2012. July 3: Hawker Beechcraft files bankruptcy. JULPage 13 July 10: San Bernardino city council votes to authorize Chapter 9 petition. July 16: Judge approves Tribune exit. Aug. 1: San Bernardino files Chapter 9. Aug. 11: Lehman files papers for Archstone IPO, plans to raise $100 million. AUG Aug. 17: Kodak says digital patent sale uncertain.Bloomberg Brief Bankruptcy & Restructuring 2012 Review & 2013 Outlook Aug. 20: ATP Oil & Gas files bankruptcy, listing debt of $3.5 billion. Newsletter Ted Merz Bankruptcy & Aleksandrs Rozens Executive Editor tmerz@bloomberg.net Restructuring arozens@bloomberg.net Sep. 5: AMR wins approval to reject pilot contracts. +1-212-617-2309 Newletter Editor 212-617-5211 SEP Sep. 7: Central Falls, Rhode Island, bankruptcy plan approved. Bloomberg News Patrick Oster Sep. 11: Digital Domain files Chapter 11 in Delaware. Managing Editor poster@bloomberg.net 212-617-4088 Oct. 1: Dynegy implements merger and reorganization plan.Contributing Editors Oct. 9: Creditors of Mervyn’s LLC win $166 million LBO suit. Creditors said a 2004Deirdre Fretz Nathaniel Baker buyout was fraught with fraudulent conveyances. OCTdfretz@bloomberg.net nbaker14@bloomberg.net Oct. 16: A123 Systems files Chapter 11 in Delaware.212-617-5166 212-617-2741 Oct. 22: Solyndra wins bankruptcy plan approval. Oct. 24: U.K. supreme court says won’t recognize U.S. bankruptcy judgements.AnalystsJohn Veidis Rob Restaino Nov. 2: Bain’s Contec implements prepackaged plan.jveidis2@bloomberg.net rrestaino2@bloomberg.net NOv Nov. 14: Overseas Shipholding files in Delaware, listing debt of $2.67 billion.609-279-3802 609-279-4344 Nov. 29: Hostess wins approval to liquidate business.To subscribe via the Bloomberg terminal type BRIEF <GO> or on the web at:www.bloombergbriefs.comThis newsletter and its contents may not be forwarded or redistributed without the prior consent of Dec. 21: Stifel Financial acquires 100 percent of Miller Buckfire.Bloomberg. Please contact our reprints and permissions group listed above for more information DEC Dec. 27: AMR pilots say US Air merger may not occur in bankruptcy.© 2013 Bloomberg LP All rights reserved. .  1 2 3 4 5 6 7 8 9 10 11 12 13 
  • 01.03.13 www.bloombergbriefs.com Bloomberg Brief | Bankruptcy Restructuring 3outlook 2013: Voices click on orange triangles for interactive featureCoal, Retail, Restaurants and Real Estate to Dominate 2013 RestructuringsBankruptcy professionals expect coal companies, retailers, restaurants and real estate to be the biggest source of restructuring activitynext year. Problems in Europe could spur more Chapter 15s as non-U.S. companies look to protect U.S. assets from creditors and Euro-pean banks likely will sell off non-core assets such as non-perfoming loans. - Aleksandrs Rozens Chapter 15s are going to continue to If you look at the largest universal banks, multiply if they don’t solve the eurozone you could continue to see some asset sales problem and it will be complicated by a but there’s not a lot of pressure to do that U.S. failure to deal with the fiscal cliff. right now. The reason for that is because You may start to see some insurance a lot of the assets are earning pretty good holding companies file Chapter 15s. returns. If you sell that asset, what do you A lot of events, like Sandy, are going replace it with? The universal banks – I think to put a big strain on insurance com- we’ll see Citi continue or maybe accelerateHarvey Miller panies. The holding companies may Fred Cannon some of the dispositions of their troubledpartner find themselves in difficulties. They will managing director, assets. Most regional and small banks feelWeil Gotshal & probably end up in the Cayman Islands equity research they get a better price from a slow workoutManges or someplace and then file a 15 here to KBW situation and selling the loans one off, than protect their assets. they do in bulk sales. In my experience, the pendulum swings What’s going to happen next year is one way hard and then it swings the other in Europe – a combination of sover- way hard. At some point, not only will dis- eign issues hovering over Europe and tressed credits be forced to restructure, but Basel 3. As a result of that there will even “decent” credits will face restructuring be a cautious deleveraging by financial pressure when the capital spigot tightens institutions of non-core assets, primarly past “medium” to “very tight” At that point . non-performing loans, and some portfo- we will see a huge amount of restructuring lios with single name corporates.I don’tJeffrey Werbalowsky opportunities given the amount of leverage Daniel Ehrmann think it is going to be the wave peopleco-CEO placed into the system over the last three managing director have been expecting for the last threeHoulihan Lokey years. There is nothing in sight that will Alvarez & Marsal years but I do think there is going to be push restructuring activity up materially, but activity in Europe. Banks – while they I do know this easy credit can’t last and we have been prone to amend and extend – are headed for a material downturn and a want to get the stuff off of their balance lot of restructurings. It is not going to be as sheet at some point. Single name posi- rapid a downturn nor will it be as dramatic tions of loans – they are going to start as 2008. Our next downturn will be more selling them off. All of the hedge funds sustained. It will be less defaults per unit are gearing up in Europe. They have too of time, but more defaults over time. It will much money to spend and not enough extend over a three-year period. opportunities right now. There is a tremendous amount of activity If we have some major exogenous shock, and effort going on in Europe where the in- for instance the euro complex is no longer vestment, buyside community is working to able to sustain the fiction of sovereign build up a very extensive infrastructure to solvency for Greece and Spain and some buy portfolios – real estate loans, corporate of the other weaker countries, then we’re loans, consumer loans. Whether the big going to have a major liquidity drop that will banks are ready to transact will depend on change the tone and increase the amount a case by case basis. Technology contin- of restructuring activity we see here. TheDavid Ying ues to change very rapidly. You constantly Durc Savini euro issue is probably the one that is thesenior managing see creative destruction going on in the managing director biggest risk. They just keep kicking thedirector technology industry. You have the whole Peter J Solomon can down the road. The fiscal cliff issueEvercore Partners cell phone industry and the telecom equip- is a crisis to which markets will respond ment ecosystem is changing very rapidly. negatively if you can’t get a deal done here. It will shut off the spigot of credit. continued on next page  1 2 3 4 5 6 7 8 9 10 11 12 13 
  • 01.03.13 www.bloombergbriefs.com Bloomberg Brief | Bankruptcy Restructuring 4outlook 2013: Voices...continued from previous page Shipping is still going to be the one Real estate bankruptcies will continue at industry that continues to generate a this high level. People can’t repay loans and significant amount of activity. We repo- they cant refinance them. That’s happening sitioned the firm for that so we are do- with CMBS and conventional bank loans. ing quite a lot of work in shipping right We’ll see moderately higher levels in bank- now and I think that will continue. We ruptcies and restructurings will continue are actually working with people who over the next several years until the 2016, are acquiring ships and we are also 2017 time frame. Lodging still shows plentyKenneth Buckfire advising some companies with respect Mark Richardson of signs of difficulty along with industrials,CEO to their balance sheets. The major fac- principal general commercial office and retail. WhileMiller Buckfire tor in shipping is the surplus of ships. Huntley, Mullaney, interest rates are low, financing is definitely In 2007 and 2008 the banks basically Spargo & Sullivan harder because underwriting is more strin- gave a loan to anybody who wanted to gent. There is less CMBS volume out there. build a ship. Banks are a lot more conservative. Companies that might have been Coal is going to continue to struggle. I do wobbling previously are able to refi- expect coal companies to file Chapter nance in this market. Almost anybody 11s this year. We will continue to see that wasn’t in deep financial stress problems in retail when people have a is able to refinance or has already lot less disposable income, and I think been refinanced. This should help the on that front that restaurants are going to default rate for high-yield debt stay take a hit right with them. A lot of people below 2 percent for 2012. I don’t see are going to be worried about theirTimothy Coleman any reason why 2013 should be any Kelly Stapleton income shrinking in 2013 with the fiscalsenior managing different, putting aside major exog- managing director cliff. I think this year we might start wor-director enous events. Alvarez & Marsal rying about rising unemployment again.Blackstone Group LP SUBScriBe tO BlOOMBerg BrieFS Market leading intelligence Bloomberg Briefs publishes 18 newsletters to help you stay ahead of the markets. Individual and group subscriptions available. Visit www.bloombergbriefs.com to subscribe or take a trial. Or call Annie Gustavson at +1-212-617-0544. GET THE WORLD. IN BRIEF GET THE BRIEF BLOOMBERGBRIEFS.COM BRIEF BLOOMB  1 2 3 4 5 6 7 8 9 10 11 12 13 
  • 01.03.13 www.bloombergbriefs.com Bloomberg Brief | Bankruptcy Restructuring 52012 Review: Bond & Loan RecoveriesGeneral Maritime, Broadview Networks Show Disparity of Payouts Upon Chapter 11 Exit General Maritime had the largest disparity between recovery rates for lenders and bondholders among the 37 companies thatfiled disclosure statements this year upon exiting bankruptcy. Broadview Network’s creditors received full payments, illustratingthe wide variety of outcomes from the chapter 11 process. General Maritime filed for bankruptcy in November 2011 and exited six months later. Three classes of secured loan claims werepaid in full, according to data compiled by Bloomberg. Two claims totaling $858 million received $75 million cash and $783 millionin new loans upon emergence. Creditors for the $175 million third class of loans opted for equity in the post-bankrupt company.Bondholders and other general unsecured claimants, owed a total of $362 million to $383 million, received warrants for an estimat-ed 2 percent recovery. Broadview Networks’ lenders and senior noteholders received 100 percent recovery. The company filed for bankruptcy in August2012 and exited three months later. Lenders owed $14 million under an asset-based loan were repaid in full upon exit. Senior se-cured noteholders with a $317 million claim received a 100 percent estimated recovery in the form of a $150 million bond that pays10.5 percent until 2017 and 97.5 percent of equity in the post-bankrupt company. The chart below shows the recoveries from 37 companies among those that issued disclosure statements in 2012. The redbubbles represent bonds, those in blue show loans. The size of the bubble indicates the relative face value of the debt at issue. Estimated recoveries on loans, usually secured, are usually higher and less volatile than estimated recoveries on bonds, usu-ally unsecured. Most loans are estimated to recover 100 percent through either repayment, exchange or other settlement via thebankruptcy process. Most bonds are estimated to recover less than 50 percent. The following page shows recovery rates since 2000. Though generally uncorrelated and having fewer recent observations, thecurrent trendline for loan recoveries breached its longer-term average following the latest bankruptcy peak in 2009. The currenttrendline for bond recoveries is rising towards its longer-term average. The illustrations represents about 500 loan claims and 600bond claims with amounts and recoveries culled from nearly 900 disclosure statements captured in Bloomberg’s current databaseof nearly 2,000 bankruptcies. – John Veidis and Rob Restaino, Bloomberg analysts. They can be reached at jveidis2@bloomberg.net and rrestaino2@bloomberg.net continued on next page 2012 Disclosure Statement Recoveries 120% Loans Bonds General Maritime Broadview 100% Networks Loans & Homer City Reddy Ice 1st Lien Bonds 80% Estimated Recoveries Loans & Bonds Houghton Legends Gaming WaMu Senior Bonds Mifflin Hawker 60% Buffets Loans & Beechcraft Loans Bonds Allowed Secured Hawker 40% Bicent Bond & WaMu Jr Bonds General Maritime 1st Lien Loan Deficiency 20% Reddy Ice 2nd Lien & Claim 2nd Lien Unsecured Contec 0% Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 -20% Date of Disclosure Statement Source: Bloomberg LPRecovery rates from 37 companies that issued disclosure statements in 2012. Loans are shown in blue and bonds are shown in red. The size of thebubble represents the face value of the debt at issue.  1 2 3 4 5 6 7 8 9 10 11 12 13 
  • 01.03.13 www.bloombergbriefs.com Bloomberg Brief | Bankruptcy Restructuring 6Bond & Loan Recoveries...continued from previous page Loan Recoveries 120% 100% Trendline 80% Estimated Recoveries Average 60% 40% 20% 0% Dec-99 Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -20% Date of Disclosure Statement Source: Bloomberg LPRecovery rates of about 500 loans made to companies that issued disclosure statements since 2000. The size of the bubble represents the face value ofthe loans at issue. Bond Recoveries 120% 100% Estimated Recoveries 80% 60% 40% Average Trendline 20% 0% Dec-99 Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 -20% Date of Disclosure Statement Source: Bloomberg LPRecovery rates of about 600 bonds made to companies that issued disclosure statements since 2000. The size of the bubble represents the face value ofthe bonds at issue.  1 2 3 4 5 6 7 8 9 10 11 12 13 
  • 01.03.13 www.bloombergbriefs.com Bloomberg Brief | Bankruptcy Restructuring 72012 review: Chapter 11 Petitions By StateCalifornia, Texas and Florida Businesses Lead Chapter 11 Filing ActivityTwo hundred and eighty-two California businesses with debt of $1 million or more sought bankruptcy protection in 2012, making it themost active state for such filings. Florida was the second-most active with 205 filings, followed by Texas with 204 and New York, where154 businesses filed Chapter 11 petitions listing liabilities of $1 million or more.Top 12 Most Active Venues, Distribution of Filings by Liabilities Total Number 2012 Filings 2012 Filings 2012 Filings 2012 Filings 2012 Filings 2012 Filings of 2012 Filings With Liabilities With Liabilities With Liabilities With Liabilities With Liabilities With Venue With Liabilities Between $1 Between $10 Between $50 Between $100 Between $500 Liabilities of $1 Million or Million to $10 Million to $50 Million to $100 Million to $500 Million to $1 of $1 Billion More Million Million Million Million Billion or More Central District of California 154 122 25 3 3 0 0 Middle District of Florida 122 94 26 0 1 0 1 Southern District of New York 88 49 23 3 13 2 10 District of Arizona 86 62 17 3 4 0 0 Northern District of Texas 75 56 11 5 1 1 0 Northern District of Georgia 72 59 11 2 0 0 0 Southern District of Florida 72 55 16 0 0 0 1 District of Nevada 71 57 10 1 2 0 0 Eastern District of New York 64 49 10 3 2 0 0 Northern District of Illinois 64 52 9 3 0 0 0 Southern District of Texas 59 50 5 2 1 0 1 District of Delaware 58 10 17 12 15 2 2  1 2 3 4 5 6 7 8 9 10 11 12 13 
  • 01.03.13 www.bloombergbriefs.com Bloomberg Brief | Bankruptcy Restructuring 82012 review: Largest filingsLargest Chapter 11 Petitions in 2012 (Filings listing liabilities of $500 million or more) Date of Industry or Debtor Liabilities Debtor Counsel Judge Venue Filing Debtor Type Residential Capital LLC $15.3 billion 5/14/2012 Morrison & Foerster LP Martin Glenn Mortgage Finance Southern District of New York Film and Technology Eastman Kodak & Co. $6.75 billion 1/19/2012 Sullivan & Cromwell Allan L. Gropper Southern District of New York Producer Dynegy Inc. $5.13 billion 7/6/2012 White & Case LLP Cecilia Morris Energy Southern District of New York Edison Mission Energy $5.09 billion 12/17/2012 Kirkland & Ellis Jacqueline P. Cox Energy Northern District of Illinois Hawker Beechcraft Inc. $3.74 billion 5/3/2012 Kirkland & Ellis LLP Stuart M. Bernstein Private Jet Maker Southern District of New York Houghton Mifflin $3.54 billion 5/21/2012 Paul Weiss Rifkind Wharton Joan N. Feeney Publisher District of Massachusetts ATP Oil & Gas $3.5 billion 8/17/2012 Mayer Brown LLP Marvin Isgur Oil and Gas Southern District of Texas Patriot Coal Corp. $3.07 billion 7/9/2012 Davis Polk & Wardwell Kathy A. Surratt-States Coal Miner Eastern District of Missouri Overseas Shipholding Group $2.67 billion 11/14/2012 Morris, Nichols, Arsht & Tunnell LLP Peter J. Walsh Shipping District of Delaware Arcapita Investment Holdings $2.55 billion 3/19/2012 Gibson, Dunn, & Crutcher LLP Sean H. Lane Private Equity Southern District of New York Ocala Funding LLC $2.3 billion 7/10/2012 Stichter, Riedel, Blain & Prosser Jerry A. Funk Mortgage Finance Middle District of Florida LightSquared Inc. $2.29 billion 5/14/2012 Milbank, Tweed, Hadley & McCloy Shelley C. Chapman Telecommunications Southern District of New York IBC Sales Corp. (Hostess) $1.4 billion 1/11/2012 Jones Day Robert D. Drain Baker Southern District of New York Pinnacle Airlines Inc. $1.4 billion 4/1/2012 Davis Polk & Wardwell Robert E. Gerber Airline Southern District of New York WP Steel Venture (RG Steel) More than $1 billion (1) 5/31/2012 ASK Financial Kevin J. Carey Steel Mills District of Delaware Franklin Credit Holding Corp. $827.3 million 6/4/2012 McCarter & English Donald H. Steckroth Mortgage Finance District of New Jersey Vertis Holdings $814 million 10/10/2012 Cadwalader Wickersham & Taft Christopher S. Sontchi Magazine Inserts District of Delaware Velo Holdings Inc. (Interactive $713.3 million 4/2/2012 Dechert Martin Glenn Insurance Southern District of New York Media Group) $500 million to $1 billion Bicent Holdings LLC 4/23/2012 Young Conaway Stargatt & Taylor Kevin Gross Energy District of Delaware (2)Source: Bloomberg Briefs1. WP/RG Steel’s exact total liabilites of more than $1 billion have not been disclosed. Liabilities include $400 million senior revolving credit facility, $218.7 million outstanding on asecond-lien revolver, and $131 million in subordinated notes owed to parent Renco.2. Bicent’s first and second lien lenders are owed $276 million. Additional liabilities have not been disclosed.Largest Fourth Quarter 2012 Bankruptcy Filings (Filings listing liabilities of $100 million or more) Date of Industry or Debtor Liabilities Debtor counsel Judge Venue filing debtor type Edison Mission Energy $5.09 billion 12/17/2012 Kirkland & Ellis Jacqueline P. Cox Energy Northern District of Illinois Overseas Shipholding Group $2.67 billion 11/14/2012 Morris, Nichols, Arsht & Tunnell LLP Peter J. Walsh Shipping District of Delaware Vertis Holdings Inc. $814 million 10/10/2012 Cadwalader Wickersham & Taft LLP Christopher S. Sontchi Magazine Inserts District of Delaware Lifecare Holdings $576 million 12/11/2012 Skadden Arps Slate Meagher & Flom kevin gross Hospital Operator District of Delaware A123 Securities $376 million 10/16/2012 Latham & Watkins LLP Kevin J. Carey Electric Car Batteries District of Delaware Auto and Motorcylces Central District of American Suzuki $346 million 11/6/2012 Pachulski Stang Ziehl & Jones LLP Scott C. Clarkson Distributor California Interfaith Medical $341 million 12/3/2012 Willkie Farr & Gallagher LLP Carla Craig Hospital Operator Eastern District of N.Y. Young Conaway Stargatt & Taylor, THQ Inc. $248 million 12/19/2012 Mary F Walrath Video Games Maker District of Delaware LLP Inspiration Biopharmaceuticals $241 million 10/30/2012 Murphy & King William C. Hillman Drug Developer District of Mass. Pat E. Morgenstern- South Franklin LLC $166.3 million 10/24/2012 McDonald Hopkins LLC Retirement Community Northern District of Ohio Clarren HMX LLC $120 million 10/19/2012 Proskauer Rose LLP Allan L. Gropper Apparel Southern District of N.Y. AMF Bowling (1) $100 million - $500 million 11/13/2012 McGuireWoods LLP Kevin R. Huennekens Bowling Alley Operator Easttern District of Va. Metex Manufacturing (2) $100 million - $500 million 11/9/2012 Reed Smith LLP Burton R. Lifland Floor Tile Maker Southern District of N.Y. Monitor Co. (3) $100 million - $500 million 11/8/2012 Ropes & Gray LLP Christopher S. Sontchi Consulting Group District of DelawareSource: Bloomberg Briefs1. Schedule of assets and liabilities to be filed on Jan. 10, 2013.2. Liabilities include unquantified asbestos claims.3. Precise total for debt owed not available continued on next page  1 2 3 4 5 6 7 8 9 10 11 12 13 
  • 01.03.13 www.bloombergbriefs.com Bloomberg Brief | Bankruptcy Restructuring 92012 Review: Largest Filings, Chapter 9 Petitions, breakdown of chapter 11 casescontinued from previous pageFiling Activity by Month Large Filings by Industry Monthly Petition Activity Large Petitions By Industry Type 900 2009 Filings ($500 million or more) 800 2010 Filings Financials 700 6% 2011 Filings 6% 6%Number of petitions 600 2012 Filings Industrials 500 29% Energy 400 300 Consumer Staples 24% 200 29% Technology and 100 telecommunications 0 Consumer discretionary Jan. Feb. Mar. Apr. May Jun. July Aug. Sept. Oct. Nov. Dec. Affiliated cases have not been consolidated. Source: Bloomberg Briefs Source: Bloomberg BriefsBankruptcy activity in 2012 was eclipsed by 2011 petitions during seven In 2012, financial and industrial businesses each accounted for 29 percentmonths; it exceeded the previous year’s pace during five months. of all Chapter 11 petitions listing liabilities of $500 million or more.Petitions Listing $1M-$10M Dominate ‘12 Filings California Municipalities Drive Chapter 9 Activity 2012 Chapter 11s, By Liabilities Listed 2012 Chapter 9 Activity By State 1,600 1,400 California 9% 1,200 Six Chapter 11 petitions involved Arkansas 9% Number of Petitions 1,000 liabilities of $500 million to 37% Nebraska 800 $1 billion. 9% 600 New York 400 Georgia 200 18% 0 Oklaholma $1 million to $10 million to $50 million to $100 million to $500 million to $1 billion or 18% $10 million $50 million $100 million $500 million $1 billion more Source: Bloomberg Briefs Source: Bloomberg BriefsA majority of the Chapter 11 bankruptcy cases involved debtors listing In 2012, California was the biggest source of Chapter 9 petitions; in 2011liabilities of $1 million to $10 million. Nebraska led Chapter 9 filings and accounted for 4 of 13 such cases. SUBScriBe tO BlOOMBerg BrieFS Market leading intelligence Bloomberg Briefs publishes 18 newsletters to help you stay ahead of the markets. Individual and group subscriptions available. Visit www.bloombergbriefs.com to subscribe or take a trial. GET THE WORLD. Or call Annie Gustavson at +1-212-617-0544. BRIEF BLOOMBERGBRIE  1 2 3 4 5 6 7 8 9 10 11 12 13 
  • 01.03.13 www.bloombergbriefs.com Bloomberg Brief | Bankruptcy Restructuring 102012 Review: Single Asset REal EstateSingle Asset Real Estate Petitions Were Concentrated in California, New York and TexasMajority of Single Asset Real Estate 2012 Petitions Involved Debt Less Than $10 Million Single Asset Real Estate Petition Activity Single Asset Real Estate By Size of Listed Debt 1% 1% All other debtor types Single asset real estate $1 million - $10 million In 2012, a quarter 13% of the 2,042 new Chapter 11 filings $10 million - $50 million with assets and 75% liabilities greater 25% than $1 million $50 million - $100 million involved single asset real estate. 85% All cases have been $100 million - $500 million consolidated. Source: BLAW & Bloomberg Briefs Source: Bloomberg BriefsOne fourth of all Chapter 11 bankruptcies listing debt of $1 million or more Eighty-five percent of all single asset real estate businesses filing Chapterin 2012 involved single asset real estate. Seventy-eight single asset real 11 petitions in 2012 listing liabilities of $1 million or more had debt ofestate businesses were based in California, 57 such businesses were under $10 million. Thirteen percent of single asset real estate petitionsfrom New York and 52 single asset real estate filings were based in Texas. involved debt of $10 million to $50 million.  1 2 3 4 5 6 7 8 9 10 11 12 13 
  • 01.03.13 www.bloombergbriefs.com Bloomberg Brief | Bankruptcy Restructuring 112012 Review: municipal bankruptcy PetitionsChapter 9 Bankruptcy Petitions of 2012 Debtor Venue Liabilities Debtor Counsel State Date of filing Mendocino Coast Health Care District N.D. Calif. $10 million - $50 million Friedman and Springwater LLP Calif. 10/17/12 Siloam Springs Municipal Property Owners Improvement District No. 1- W.D. Ark. $100,000 - $500,000 John T. Lee Ark. 10/4/12 Sanitary and Improvement District No. 270 of Sarpy County, Nebraska Dist. Of Nebraska $10 million - $50 million Ronald W. Hunter Neb. 8/28/12 City of San Bernardino C.D. Calif. Greater than $1 billion Stradling Yocca Carlson & Rauth Calif. 8/1/12 Town of Mammoth Lakes* E.D. Calif. $50 million - $100 million Klee Tuchin Bogdanoff Calif. 7/3/12 City of Stockton, California E.D. Calif. $500 million - $1 billion Herrington & Sutcliffe Calif. 6/28/12 Suffolk Regional Off-Track Betting Corporation E.D.N.Y. $10 million - $50 Million McKenna Long & Aldridge N.Y. 5/11/12 Hospital Authority of Charlton County S.D. Ga. $1 million - $10 million McCallar Law Firm Ga. 4/30/12 Sylamore Valley Water Association Public Facilities Board of Izard County E.D. Ark. $1 million - $10 million Davidson Law Firm Ark. 4/19/12 Rural Water District No. 1, Cherokee County E.D. Okla. $500,000 - $ 1million Gable & Gotwals Ok. 1/23/12 Sanitary and Improvement District No. 268 of Sarpy Dist. Of Nebraska $1 million - $10 million Fullenkamp, Doyle & Jobeun Neb. 1/23/12*Case dismissed after city settled suit.Pace of Chapter 9 Petitions Declines in 2012 From 2011 Level Eleven Chapter 9s were filed last year,down from 13 in 2011. One of 2012’s caseswas dimissed after the town of Mammoth Chapter 9 Activity By YearLakes, Calif., settled a lawsuit. 14 California municipal entities were thebiggest source of petitions. The four 12Chapter 9s came from California wereMendocino Coast Health Care District, the 10 Number of filingscity of San Bernardino, the city of Stock-ton and Mammoth Lakes. 8 San Bernardino, which listed liabilitiesof greater than $1 billion, was the largest 6petition of the year. - Aleksandrs Rozens 4 2 0 2008 2009 2010 2011 2012 Source: Bloomberg Briefs Make an IMpact wIth Bloomberg Briefs provide dedicated licenses to reuse our content to help your business. We offer a full suite of BlooMBerg BrIef content products and services ranging from hardcopy and electronic reprints to plaques, permissions/licensing and photocopies. to find the solution that is right for you, contact us today at: 800 290 5460 x 100, email: bloombergbriefreprints@theygsgroup.com  1 2 3 4 5 6 7 8 9 10 11 12 13 
  • 01.03.13 www.bloombergbriefs.com Bloomberg Brief | Bankruptcy Restructuring 122012 review: Chapter 15 Activity click on charts for interactive featuresTop 10 Chapter 15 Petitions CORPORATE Debtor COURT DEBTOR COUNSEL JUDGE LIABILITIES DATE OF FILING BTA Bank JSC Bankr. S.D. N.Y. White & Case LLP James M. Peck Greater than $1 billion 16/07/2012 Centrais Eletricas Bankr. S.D. N.Y. Shearman & Sterling Shelley C. Chapman Greater than $1 billion 09/11/2012 Elpida Memory Bankr. D. Del. Davis Polk & Wardwell LLP Christopher Sontchi Greater than $1 billion 19/03/2012 Catalyst Paper GP Bankr. D. Del. Skadden Arps Slate Meagher & Flom Peter J. Walsh Greater than $1 billion 17/01/2012 JSC Astana-Finance Bankr. S.D.N.Y. Sidley Austin LLP Allan L. Gropper Greater than $1 billion 02/10/2012 The Sanko Steamwhip Co. Bankr. S.D.N.Y. Allen & Overy LLP James M. Peck $500 million - $1 billion 02/07/2012 Lehman Brothers Australia Ltd. (aka Grange Securities) Bankr. S.D. N.Y. Kirkland & Ellis LLP James M. Peck $500 million - $1 billion 06/01/2012 Cinram International Inc. Bankr. D. Del. Young, Conaway, Stargatt & Taylor Kevin Carey $500 million - $1 billion 25/06/2012 Humpuss Sea Transport Bankr. S.D. N.Y. Stroock & Stroock & Lavan LLP Shelley C. Chapman $100 million - $500 million 19/03/2012 Arctic Glacier Inc. Bankr. D. Del. Young, Conaway, Stargatt & Taylor Kevin Gross $100 million - $500 million 22/02/2012Source: Bloomberg BriefsCanadian Firms Drive Chapter 15s Chapter 15 Activity By NationCanadian businesses accounted for 37percent of all Chapter 15s filed in 2012. Canada All other nationsThese businesses included NorgateMetal, Catalyst Paper, Domfoam Interna-tional, Natura World and Arctic Glacier. Canada was theDelaware served as the venue for three biggest source ofof these Canadian filings. England was Chapter 15 filingsthe second biggest source of businesses in 2012. Thirteenlooking to protect their U.S. assets with of the 35 Chaptera Chapter 15. Five companies from Eng- 63% 37% 15 cases filed lastland filed Chapter 15 petitions and three year involvedof these cases are being handled by New Canadian businesses.York’s southern district. All cases have been consolidated. Source: Bloomberg BriefsNew York’s Southern District Busiest Venue Financial Industry Leads 2012 Chapter 15 Activity Chapter 15 Activity By Venue Chapter 15s By Debtor Type Bankr. D. Mass. Bankr. N.D. Ohio All other debtor types Financials Bankr. D. Nev. Bankr. E.D.Va. Bankr. N.D. Ala. Ten of the 35 Bankr. E.D. Mich. companies that 29% Bankr. E.D. La. filed Chapter 15s Bankr. D. Az. in U.S. courts fell into the category Bankr. C.D. Calif. of financial Bankr. N.D. Iowa services businesses. 71% Bankr. S.D. Tex. Bankr. D. Del. Bankr. S.D. N.Y. All cases have been consolidated. 0 5 10 15 Source: Bloomberg Briefs Source: Bloomberg BriefsNew York’s southern district served as the venue for 16 of the 35 Chapter Financial services businesses that filed Chapter 15s included JSC Asta-15 petitions filed in 2012. Delaware took on six such cases. na-Finance, Gerova Financial, Octaviar and Lehman’s Australian affiliate.  1 2 3 4 5 6 7 8 9 10 11 12 13 
  • 01.03.13 www.bloombergbriefs.com Bloomberg Brief | Bankruptcy Restructuring 132012 REview: Post Petition Bond Price Moves click on charts for interactive featuresAmerican Airlines and MF Global benchmark bonds appreciated this year as traders’ expectations for recovery rates increased. New-Page debt prices declined as the merger with Verso became less likely.MF Global Bond Price Increased 78% in 2012 AMR Bond Price Increased Four-Fold in 2012 MF Global 6.25% Due 2016 American Airlines 9% Due 2016 70 90 65 MF Global Files for Bankruptcy Oct. 31, 2011 AMR Corp Files for Pilots ratify contract 80 Bankruptcy Nov. 29, 2011 60 70 55 KPMG estimates UK payout of up to 60 50 $3.2 billion 50 AMR and US Price (Cents) Price (Cents) 45 Approved to AMR posts Airways 40 40 payout claims of quarterly merger said less than $50,000. 30 profit to progress, 35 US Airways said to These claims total may come as 30 $22.7 billion. 20 discuss AMR soon as takeover with January 25 10 creditors 20 0 1/1/2012 4/1/2012 7/1/2012 10/1/2012 1/1/2012 4/1/2012 7/1/2012 10/1/2012 Source: Bloomberg LP Source: Bloomberg LPNewPage Bond Price Declined 37 Percent in 2012 Patriot Coal Bond Gained 38% Since Bankruptcy 90 NewPage 11.375% Due 2014 110 Patriot Coal 8.25% Due 2018 NewPage Corp files for 85 bankruptcy Sept. 7, 2011 100 80 Restructuring plan 90 NewPage seeks relaxation of covenants approved 75 Patriot Coal petitions for bankruptcy 80 protection July 9 70 Rate set on 70 Price (Cents)Price (Cents) 65 exit loans Seeks $625 million in 60 loans to refinance 60 50 debt 55 Verso Paper says it will not 40 50 pursue buyout Cuts met coal 30 production goals on 45 low demand 40 20 1/1/2012 4/1/2012 7/1/2012 10/1/2012 1/1/2012 4/1/2012 7/1/2012 10/1/2012 Source: Bloomberg LP Source: Bloomberg LPLargest Active Chapter 11 Bankruptcy Cases Debtor Liabilities Date of filing Debtor counsel Judge Industry or debtor type Venue MF Global Holdings Ltd. $39.7 billion 10/31/2011 Skadden Arps Martin Glenn investment bank Southern District of New York AMR Corp. $29.6 billion 11/29/11 Weil Gotshal Sean H. Lane airline Southern District of New York Residential Capital LLC $15.3 billion 5/14/2012 Morrison & Foerster Martin Glenn mortgage lender Southern District of New York Eastman Kodak Co. $6.75 billion 1/19/2012 Sullivan & Cromwell Allan L. Gropper film and camera manufacturer Southern District of New York Dynegy Holdings LLC. $6.18 billion 11/7/2011 Sidley Austin Cecilia Morris power producer Southern District of New York Hawker Beechcraft Inc. $3.74 billion 5/3/2012 Kirkland & Ellis Stuart M. Bernstein private jet manufacturer Southern District of New York ATP Oil & Gas $3.5 billion 8/17/2012 Mayer Brown Marvin Isgur oil and gas development and Southern District of Texas Patriot Coal Corp. $3.07 billion 7/9/12 Davis Polk Shelley Chapman production Southern District of New York Arcapita Investment Holdings $2.55 billion 3/19/2012 Gibson Dunn Sean H. Lane private equity firm Southern District of New York LightSquared Inc. $2.29 billion 5/14/2012 Milbank, Tweed, Hadley & McCloy Shelley C. Chapman telecommunications Southern District of New YorkSource: Bloomberg Briefs  1 2 3 4 5 6 7 8 9 10 11 12 13