Below is our initial take on some of the major bankruptcy-related developments from the past week:
Please note that ABI Membership is required to access the full summary of this article.
This week, the House Judiciary Committee voted to approve the Nondebtor Release Prohibition Act, which will overhaul the corporate bankruptcy system.
S&K Take: The NRPA is headed to the floor for a House vote. The bill proposes to broadly ban non-consensual third party releases and Texas two-steps, both of which have been used to limit liability in bankruptcies past. Opponents argue that this is too broad a measure and may have unintended consequences.
Owner of two skyscrapers in New York and Chicago, PWM Property Management, an HNA Group affiliate, filed for Chapter 11 bankruptcy. PWM claims to have between $1 billion and $10 billion in assets and liabilities.
S&K Take: The pandemic had a huge impact on commercial real estate, with tenants seeking relief from landlords and considering downsizing their footprint. This may be anecdotal, but it has not seemed as though there have been many “mega” cases in the industry though. This case certainly qualifies, with HNA the ultimate owner, SL Green heavily involved, and even MLB thrown into the mix for good measure. Will be an interesting case to watch.
Mallinckrodt’s hearing for the confirmation of its Chapter 11 plan began this week in Delaware bankruptcy court.
S&K Take: The Mallinckrodt confirmation hearing kicked off in earnest this week, and promises to be on our radar for some time.
A New York bankruptcy judge approved for GTT Communications Inc to continue with its fast-tracked Chapter 11 proceedings which will help alleviate some of the companies reported $4.1 billion in total liabilities.
S&K Take: The anticipated GTT bankruptcy cases were filed as a prepackaged case. While this may be jumping the gun a bit, the cases appear like they may be destined for smooth sailing. Time will tell of course.