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State Law

: Showmeblawgs

By stan_sipple

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Interstate Bakeries (IBC) files Chapter 11 reorganization plan. KC Business Journal. d get about $616 million in payments as part of a plan to emerge from more than three years in Chapter 11 bankruptcy.Unsecured creditors, owed $193.9 million, would receive 26.1 percent, or $50.6 million, according to a Monday filing with the Securities and Exchange Commission.Holders of secured, priority, administrative convenience, workers' compensation, prepetition lender, capital lease and general unsecured claims would be repaid in full.Holders of prepetition lender claims would receive 3,333,333 shares of Class A common stock; holders of general unsecured claims would get 6,666,667 shares of Class B stock.Existing shares would be terminated.

In the filing, the Kansas City-based baker, known for brands such as Hostess and Wonder, estimated its value at $572 million to $670 million. The company assumed an effective date of April 5 for its emergence from bankruptcy.

The amendments filled in pieces it had left out of the reorganization plan filed in the fall. A hearing Tuesday will determine whether IBC gets approval to seek constituent approval of the plan.

IBC's proposed emergence financing -- $400 million from Silver Point Finance LLC -- requires agreement with the International Brotherhood of Teamsters union, which has said it would rather see the company liquidate than agree to the new plan and concessions. Employees ratified more than 95 percent of contracts with IBC's other large union, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union.

The Teamsters joined with potential investor Yucaipa Cos. LLC in a buyout attempt, but IBC found the group's preliminary offer unqualified, and Yucaipa didn't file a revised offer.

The reorganization plan would require acceptance from some creditors and the Bankruptcy Court. A hearing on the confirmation is scheduled for March 12; any objections must be filed by March 3.

"The plan provides for an equitable and early distribution to creditors of the debtors, preserves the value of the business as a going concern and preserves the jobs of employees," IBC said in the filing.

Alternatives could cause delays, litigation, costs, loss of jobs and less repayment to creditors, IBC said in the filing.

If no reorganization plan is confirmed, the company may be liquidated, IBC said.

IBC operates 41 bakeries and about 750 bakery outlets throughout the country. Net sales for 2007 were more than $2.9 billion.

Full post as published by Showmeblawgs on February 07, 2008 (boomark / email).