COURT: JAMESWAY MUST LISTEN TO UNHAPPY CREDITORS’ GROUP
NEW YORK — A bankruptcy judge here ruled Friday that Jamesway Corp. will have to listen to a group of dissident creditors before it can have a hearing on its disclosure statement.
Jamesway filed a reorganization plan July 7 that was roundly booed by its unsecured creditors’ committee. The committee, which is asking for the court’s permission to file its own plan, wants Jamesway to boost its payout by at a minimum of $20 million.
At Friday’s hearing, Bankruptcy Judge James Garrity said he was unwilling to let Jamesway pick a date for arguments on its disclosure statement before hearing from the creditors’ committee on why it wants to endJamesway’s exclusive right to file a reorganization plan.
A hearing on the committee’s motion has been scheduled for Thursday.
As reported, the unsecured creditors’ committee is unhappy over the terms of Jamesway’s payout plan. Jamesway is offering creditors approximately 50 cents on the dollar in cash and stock in a deal worth about $100 million.
Deryck A. Palmer, of Weil, Gotshal & Manges, counsel to Jamesway, told the court that the company and creditors were close to working out a consensual agreement, and should be allowed to set a hearing date.
“We will have a consensual plan that is confirmable,” stated Palmer.
However, Lester M. Kirshenbaum, of Kaye, Sholer, Fierman, Hays & Handler, attorneys for the unsecured creditors, said the two sides are still far from agreeing on a payout.
In fact, Kirshenbaum said, there has been “no change” in Jamesway’s stance on paying unsecured creditors since March, when the committee told the Secaucus, N.J.-based retailer that its offer was not acceptable.
— Fairchild News Service