Bankruptcy filed by Metro Fuel Oil

In a surprising move that occurs just over a year after its grand opening, Metro Biofuels is filing for bankruptcy along with its parent company, Metro Fuel Oil Corp., and eight subsidiaries. The company has a large facility at Enterprise Park in Calverton. The corporation plans to continue doing business during the course of the Chapter 11bankruptcy, and the bankruptcy court has made $3 million in financing available in addition to its normal revenue to keep the company running. Metro supplies and delivers biofuel alternatives and natural gas through the stimulus-funded rail spur leading to the Calverton facility. The company reportedly has $100 million in debt — about twice the amount of its assets. However, Metro Fuel Oil still hopes to raise capital and funds to meet its obligations and continue to supply products to residents and businesses in the area. Business bankruptcy filings are not always indicative of a hopeless business situation. In fact, in many instances, companies that have been caught in circumstances due to market shifts can file for Chapter 11 reorganization to allow creditors to secure their positions and to reduce their debt load so that they can keep operating at peak capacity and making money to… Continue reading

Suzuki’s American unit files for bankruptcy

Slow sales and a patchy safety record may have led Suzuki’s United States division to file for Chapter 11 bankruptcy protection. However, the company has good sales in other emerging markets such as India and Southeast Asia. In Japan, Suzuki meets the requirements for inclusion in the “kei” vehicle market whose cars must meet small size requirements and power limits, and the company’s cars have historically done well there. A strong yen has also made it more fiscally wise to sell cars in Japan rather than shipping them to America. The distributor for American Suzuki filed its bankruptcy petition with a declared $346 million in debt. The company cited low sales, a limited lineup and poor exchange rates as reasons for the petition. The company also cited the high cost of doing business under United States regulatory requirements as another reason for the decision. The company will continue to sell its inventory at dealerships, and current owners will be able to acquire parts and exercise rights under existing warranties. The company will not stop sales of motorcycles, boats and ATVs in the United States. A business bankruptcy for a company of this size can be very complicated and requires a… Continue reading

ResCap buyout approved by New York bankruptcy court

Residential Capital moved one step closer to emerging from Chapter 11 bankruptcy after a U.S. bankruptcy judge in approved a $3 billion buyout bid by a team comprised of Ocwen Loan Servicing and Walter Investment Management. The judge also approved a $1.5 billion bid by Berkshire Hathaway Inc. to purchase the troubled company’s whole loan portfolio of approximately 50,000 loans. The sales are expected to close in early 2013. Residential Capital, also known by the name ResCap, is a wholly owned subsidiary of Ally Financial, which operates auto financing and direct banking businesses. ResCap operates separately from Ally Financial as a home mortgage lender. It filed for debt relief under Chapter 11 in May because it could no longer keep up with payments on debt it had taken out to finance distressed residential mortgages. A Chapter 11 business bankruptcy may be an option for a business that cannot operate profitably due to crushing debt. After filing for Chapter 11 bankruptcy, the debtor continues to operate its business and maintains control and ownership of its assets while it tries to work out a debt reorganization plan to pay creditors. A buyout is a mechanism sometimes used in Chapter 11 proceedings to… Continue reading

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