ABI Blog Exchange

A woman walks into a store of yoga wear retailer Lululemon Athletica in downtown Vancouver in June 2014.
Ben Nelms/Reuters
A Utah company that made retail displays for a Lululemon Athletica Inc. store in San Francisco wants the yoga wear maker to pay up. In a lawsuit filed Tuesday, DGS Store Fixtures Inc. demanded money for an unpaid bill of $59,082.50. Last year, Lululemon officials hired DGS Store Fixtures to provide ceiling panels, fitting room latches and other items for a new store in the Westfield San Francisco Centre mall. According to the lawsuit, filed in U.S. Bankruptcy Court in Salt Lake City, the retailer made a partial payment of about $18,600 for the work, but officials didn’t respond to a Feb. 4 demand letter from DGS Store Fixtures. Lululemon hasn’t yet formally responded to the lawsuit, and a spokeswoman for the Vancouver-based retailer did not immediately respond to an emailed request for comment.

Read More from: WSJ.com: Bankruptcy Beat

1 week 3 days ago
How much stress can we expect to see for oil and gas producers and related companies as a result of the current low prices? And what special issues does this industry face when it’s time to restructure or file for bankruptcy? The recent volatility in crude oil prices may cause exploration and production companies to temper their production efforts and maximize their liquidity by reducing their capital investments, which could have a corresponding ripple effect throughout the oil production supply chain. For example, there could be near-term negative repercussions for oil field service providers and rig operators, who both provide personnel and equipment for the onshore and offshore exploration and production companies. Revenue for these service providers is tied to the amount of oil that is produced, not the price at which it is sold. Therefore, if less oil is being produced due to an oversupply in the market, then over-levered service providers are most at risk for near-term liquidity issues and related covenant defaults, as exploration and production companies try to modify day rates in order to maintain margins.

Read More from: WSJ.com: Bankruptcy Beat

1 week 3 days ago
How much stress can we expect to see for oil and gas producers and related companies as a result of the current low prices? And what special issues does this industry face when it’s time to restructure or file for bankruptcy? Oil and natural gas prices have fallen nearly 60% from their 2014 highs. This has created significant volatility in the financial markets, not only for crude and natural gas but also for the companies that extract those commodities. To put these price moves in context, there have only been three other periods of time since 1982 when crude prices have fallen by more than 50% in six months: the 1986 oil price collapse, the 1991 Gulf War and the 2008 financial crisis. During each of these price shocks there were significant reverberations across the energy sector, and I do not think that the 2014-2015 price dislocation will be any different. We can expect a significant amount of distress across the industry, ranging from the exploration and production companies, to the oil field service providers, to midstream, upstream, and downstream companies, all the way down to local businesses in towns that have seen exponential growth due to the boom in energy production.

Read More from: WSJ.com: Bankruptcy Beat

1 week 3 days ago
It's ironic that banks want to streamline the regulatory structure when their own structures are hardly paradigms of simplicity. Rather than weaken rules or consolidate agencies, we should focus on improving the quality of oversight Â-- and on reducing banks' complexity.

Read More from: BankThink

1 week 3 days ago
How much stress can we expect to see for oil and gas producers and related companies as a result of the current low prices? And what special issues does this industry face when it’s time to restructure or file for bankruptcy? It depends, not surprisingly, on where the price of oil is headed. Most forecasters don’t seem to agree. Some experts predict that the price of oil will fall to $20 to $30 a barrel, while others think it will rise to $70 a barrel by the end of the year and to $90 a barrel by next March. That uncertainty will tend to delay restructuring efforts. If you look at the industry historically, the oil and gas cycle tends to work off of a double-V curve. It bottoms out and curves back up slightly, bottoms out again and then rises quickly and steeply. That was the pattern in the last two major downturns. There is no reason to believe that this cycle will be different. Assuming that is the case, companies should fall into one of two categories. The first category consists of producers whose balance sheets are either very strong or who have hedged their exposure sufficiently to make it through the next 12 to 24 months. These companies should be fine and may even be natural acquirers of the more distressed companies.

Read More from: WSJ.com: Bankruptcy Beat

1 week 3 days ago
Any banker considering filing an appeal against examination findings will first weigh the drawbacks of irking regulators. This explains the surprisingly small number of appeals that regulators have received in the last few years.

Read More from: BankThink

1 week 3 days ago
EveryWare Global Inc ., maker of Anchor Hocking and Oneida kitchen products, filed for chapter 11 protection Tuesday with plans to implement a debt-for-equity swap with senior lenders. The Wall Street Journal has the Daily Bankruptcy Review article here. (Daily Bankruptcy Review is a daily newsletter with comprehensive coverage and analysis of emerging and in-progress insolvencies and turnarounds. For a two-week trial, visit http://on.wsj.com/DJBankruptcyNews, scroll to the bottom and click “try for free.”) A judge on Tuesday said LightSquared could continue using the cash that secures its lenders’ loans after brokering a compromise between the company and top lender Charlie Ergen, DBR reports. The plan to sell the Golf Club at Briar’s Creek in South Carolina out of bankruptcy faces a crucial test: a vote from some of the club’s members, DBR reports in WSJ.

Read More from: WSJ.com: Bankruptcy Beat

1 week 3 days ago
EveryWare Global Inc ., maker of Anchor Hocking and Oneida kitchen products, filed for chapter 11 protection Tuesday with plans to implement a debt-for-equity swap with senior lenders. The Wall Street Journal has the Daily Bankruptcy Review article here. (Daily Bankruptcy Review is a daily newsletter with comprehensive coverage and analysis of emerging and in-progress insolvencies and turnarounds. For a two-week trial, visit http://on.wsj.com/DJBankruptcyNews, scroll to the bottom and click “try for free.”) A judge on Tuesday said LightSquared could continue using the cash that secures its lenders’ loans after brokering a compromise between the company and top lender Charlie Ergen, DBR reports. The plan to sell the Golf Club at Briar’s Creek in South Carolina out of bankruptcy faces a crucial test: a vote from some of the club’s members, DBR reports in WSJ.

Read More from: WSJ.com: Bankruptcy Beat

1 week 3 days ago
Wall Street Journal When bankers leave Wall Street to chase their own startup dreams, they're bound to face a lifestyle adjustment. The paper interviews several "Wall Street exiles" about the transition "from a relatively coddled life of chauffeured town cars and teams of junior staffers to days filled managing the books and picking the office furniture." One anonymous interviewee admits to mourning the loss of his old firm's shoe-shine service, while another says taking the subway...

Read More from: BankThink

1 week 3 days ago
On April 7, 2015, Everyware Global, Inc. and 12 affiliates filed a prepackaged chapter 11 case in Delaware.  Affiliates include such names as Oneida, Anchor Hocking, Kenwood Silver, Sakura and Universal Tabletop.  The case is docketed as case no. 15-10743 and has been assigned to the Honorable Laurie Selber Silverstein.  A chapter 11 plan and disclosure statement has been filed with the petition. Joel Mostrom, the CFO of each of the debtors, has filed a declaration filed in support.  According to Mr. Mostrom, as of September 30, 2014, the debtors reported total assets of $237.8 million and total liabilities of $380.4 million.  As of the petition date, the debtors’ funded debt obligations include a $248.7 million term loan facility and a $60 million ABL. Under the prepackaged plan, the debtors intend to pay general unsecured creditors 100% in cash.  The $248.7 million term loan facility will be converted to approximately 96% of new equity.  The remaining 4% will be allocated to the debtors’ existing shareholders in exchange for their support of the plan.  The debtors have also received commitments for a $40 million DIP facility and continued access to their ABL facility to continue operations during the chapter 11 case. The Debtors are headquartered in Lancaster, Ohio.
1 week 3 days ago
According to the “MoneyTree Report,” internet-specific companies captured $11.9 billion in 2014, marking the highest level of internet-specific investments since 2000.  Also, multiples have skyrocketed from 10 – 12x of projected future profits to hedge funds paying 15 – 18x projected future sales in latest venture capital funding rounds. Yet, according to Pitchbook.com, only two of the 14 tech-based U.S. IPOs in the first quarter of 2015 were backed by venture capital. Is there a tension between the significant amount of venture capital dollars being invested and the decreased number of tech IPOs that are coming to market? Read more here.
1 week 3 days ago
Brandywine Townhouses, Inc. v. Fed. Nat’l Mortgage Ass’n (In re Brandywine Townhouses, Inc.), 518 B.R. 671 (Bankr. N.D. Ga. 2014) – The debtor objected to a secured creditor’s claim on a number of grounds: it did not default, if it defaulted … Continue reading →
1 week 3 days ago
For years now Bernard Madoff has been asserting that the majority of his individual clients were "net winners" insofar as they withdrew from their accounts, over time, more than they deposited.  CNBC reports that Mr. Madoff has elaborated in recent email exchanges:"'I explained that a common practice of my clients was to withdraw their profits and then recycle those profits thru new accounts with different beneficial owners like trusts, foundations and charities all funded with the winnings of the original owner,' Madoff wrote. 'This would then lead to those new accounts later being claimed as an account that lost their principal.'A spokeswoman for Picard, Amanda Remus, declined to comment on the specifics in Madoff's messages. In a statement e-mailed to CNBC, she repeated Picard's response to previous Madoff messages, saying that 'as the perpetrator of the largest financial fraud in history, Mr. Madoff's credibility is highly suspect and his assertions bring neither substantive value nor new information.'"For more, see: http://www.cnbc.com/id/102567060

Read More from: The COMI

1 week 3 days ago
Per www.globalinsolvency.com:Fri., April 3, 2015 After more than six long and lonely years, Iceland is hoping its financial isolation will soon be over. The North Atlantic nation, whose spectacular 2008 meltdown came to symbolise the greed and mismanagement of the global financial system, is expected to begin unwinding the bankruptcies of its three main banks and lifting controls on the movement of capital in and out of the island within months. For Iceland, these moves will signal rehabilitation and a return to the international financial community after the collapse of a banking system which at one time held assets worth a staggering ten times the nation’s gross domestic product. The collapse infuriated some European countries which were left on the hook for billions of dollars in compensation to depositors in failed Icelandic banks, and left Iceland shunned by Western nations in its hour of need. At the low point in October 2008, Britain used anti-terrorism legislation against the country - forcing international bankers to pick up their bags in the middle of crisis meetings and head to the airport. Now, Iceland hopes that by finally lifting capital controls it can draw a line under the crisis, restore its credit rating, lower its borrowing costs, boost its economy and revive the living standards of its 330,000 people.

Read More from: The COMI

1 week 3 days ago
If this story had not appeared in the Wall Street Journal, I would have a hard time believing it.Per www.wsj.com: By Peter Rudegeair Updated April 5, 2015 7:00 p.m. ETThe pay slips of Wall Street’s rank and file are getting a little heavier. Less so for the big bosses. The gap between what bank CEOs and their staffs take home in pay has narrowed significantly since the financial crisis, driven mostly by a drop in compensation for the leaders of the five biggest Wall Street firms, according to a Wall Street Journal review of bank regulatory filings. The average pay for a worker at the five companies jumped to new highs in 2014, but pay remained well below precrisis levels for chief executives. The CEOs last year on average made 124 times the average worker at the banks, down 55% from 273 times in 2006.The differential between CEOs’ and workers’ pay may get more attention once the U.S. Securities and Exchange Commission finalizes a rule mandating all public companies to report how much more the CEO made than a typical employee. The banking industry has opposed such disclosures.For more, see: http://www.wsj.com/articles/a-pay-gap-narrows-on-wall-street-1428267898

Read More from: The COMI

1 week 4 days ago
How much stress can we expect to see for oil and gas producers and related companies as a result of the current low prices? And what special issues does this industry face when it’s time to restructure or file for bankruptcy? The stresses within the oil and gas industry are unique due to the size of the industry and its direct ties to the global economic and political environment. Affected by an uncertain global economy, weak demand and an increase in supply, the recent drop in global oil prices is further compounded by OPEC’s maintenance of current production levels. Keeping prices low will likely disadvantage OPEC less. And as such, it may rather maintain production, keep prices low and maintain or maybe increase its market share. Sustained low prices will benefit certain players in countries, while other regions will be more disadvantaged. Beyond the oil- and gas-exploration and production companies, we will likely continue to see the trickle-down impact to other companies affected by falling oil prices, beyond the obvious pricing pressure within the midstream and oil field services sector.

Read More from: WSJ.com: Bankruptcy Beat

1 week 4 days ago
How much stress can we expect to see for oil and gas producers and related companies as a result of the current low prices? And what special issues does this industry face when it’s time to restructure or file for bankruptcy? The stresses within the oil and gas industry are unique due to the size of the industry and its direct ties to the global economic and political environment. Affected by an uncertain global economy, weak demand and an increase in supply, the recent drop in global oil prices is further compounded by OPEC’s maintenance of current production levels. Keeping prices low will likely disadvantage OPEC less. And as such, it may rather maintain production, keep prices low and maintain or maybe increase its market share. Sustained low prices will benefit certain players in countries, while other regions will be more disadvantaged. Beyond the oil- and gas-exploration and production companies, we will likely continue to see the trickle-down impact to other companies affected by falling oil prices, beyond the obvious pricing pressure within the midstream and oil field services sector.

Read More from: WSJ.com: Bankruptcy Beat

1 week 4 days ago
How much stress can we expect to see for oil and gas producers and related companies as a result of the current low prices? And what special issues does this industry face when it’s time to restructure or file for bankruptcy? Common wisdom is that the decline in oil prices to multi-year lows, driven by a steep increase in U.S. production and no let-up in foreign production, will lead to even greater distress in the oil and gas industry. I don’t disagree, but just as an earthquake can level one building and leave its neighbor weakened but standing, some sectors of the exploration and production industry will withstand this latest economic storm better than others.

Read More from: WSJ.com: Bankruptcy Beat

1 week 4 days ago
How much stress can we expect to see for oil and gas producers and related companies as a result of the current low prices? And what special issues does this industry face when it’s time to restructure or file for bankruptcy? Common wisdom is that the decline in oil prices to multi-year lows, driven by a steep increase in U.S. production and no let-up in foreign production, will lead to even greater distress in the oil and gas industry. I don’t disagree, but just as an earthquake can level one building and leave its neighbor weakened but standing, some sectors of the exploration and production industry will withstand this latest economic storm better than others.

Read More from: WSJ.com: Bankruptcy Beat

1 week 4 days ago
How much stress can we expect to see for oil and gas producers and related companies as a result of the current low prices? And what special issues does this industry face when it’s time to restructure or file for bankruptcy? The sharp decline in oil prices from more than $100 per barrel nine months ago to hovering around $50 per barrel today (with some projecting still lower prices) has raised significant concerns about a crash in the oil and gas industry and the economies that depend on it. This stems largely from the massive expansion in U.S. oil production in the wake of increasing global energy costs and the drive toward energy independence. Since 2008, U.S. oil production has increased by 3.6 million barrels per day. And production continues to increase, even with the “crisis” in the industry. This massive price decline has caused and will continue to create significant stress, but many players should be able to weather the economic storm, assuming some price stability. For those that cannot, the unique nature of the oil industry creates challenges in the restructuring environment for many, with opportunities created for others. For example, much of the U.S.’s production increase has come from capital-intensive shale production. With the “break-even” price of this production at or above the current price of oil, why has this economy not crumbled?

Read More from: WSJ.com: Bankruptcy Beat

1 week 4 days ago

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