ING Groep NV is seeking buyers for its private-banking business in Europe and Asia, according to people familiar with the situation, in the latest step by the financial-services firm to slim down after it turned to the Dutch government for aid last year, The Wall Street Journal reported. The sale process is at an early stage and any deal is likely several months away, the people said. Potential bidders for the division, which could be valued at more than $1 billion, may include Credit Suisse Group, Standard Chartered PLC, as well as banks in Singapore and Australia, say people close to the process. ING, which had grown into a banking, investment and insurance giant, was hit hard during the financial crisis, with losses on real estate and other securities forcing it to seek a €10 billion ($14.2 billion) government lifeline. The firm is now narrowing its focus and expects to raise between €6 billion and €8 billion by selling between 10 and 15 units. ING posted a first-quarter net loss of €793 million, underscoring the firm's need to strengthen itself so it can pay back the Dutch government. Read more. (Subscription required.)
Daily Insolvency News Headlines
Thu., July 23, 2009
An auction of the wireless assets of bankrupt Nortel Networks will go ahead as planned on Friday, despite objections from Research in Motion that it was blocked from submitting a $1.1 billion bid for the unit earlier this week, Reuters reported. Nortel said RIM, the maker of the ubiquitous BlackBerry smartphone, was blocked from the auction because it refused to comply with procedural requirements, including confidentiality clauses and a standstill provision requiring RIM to obtain Nortel's consent to bid for any other of its assets if it is successful in the auction this week. Preliminary offers to compete with a $650 million "stalking horse" bid from Nokia Siemens Networks for bankrupt Nortel's CDMA and LTE wireless technology businesses were due on Tuesday, and the auction is set for Friday, July 24. MatlinPatterson, a private equity firm that is also a major Nortel creditor, said soon after RIM announced its interest that it had submitted a $725 million offer for the wireless assets and that it would look at other Nortel units coming up for sale. Read more.
In a related story, Ericsson confirms it has placed a bid to buy Nortel’s CDMA and LTE assets but will not confirm the value. Nokia Siemens Networks and MatlinPatterson have gone public with their bids, Network World Canada reported. Read more.
A bankruptcy judge has given creditors of Lyondell Chemical Co. the green light to proceed with a $22 billion damages suit against wealthy financier Leonard Blavatnik, the company's board of directors and a group of banks over the leveraged buyout of the company by Basell AF SCA, Bankruptcy Law360 reported. In an oral order Tuesday, Judge Robert Gerber of the U.S. Bankruptcy Court for the Southern District of New York granted a motion by the official committee of unsecured creditors to pursue all of its claims and ordered the parties to expedite the trial. The committee filed a motion on June 15 for approval to bring claims - including breach of fiduciary duties and mismanagement claims - against the defendants for allegedly burdening Lyondell with too much debt after its 2007 acquisition by Basell, which is owned and controlled by Blavatnik. Read more. (Subscription required.)
A unit of mining giant Grupo Mexico SAB is appealing a ruling that it is on the hook for $1.38 billion in cash and a stake in lucrative Peruvian copper operations to Asarco LLC, in a case alleging Grupo fraudulently shifted the shares, tipping Asarco into bankruptcy, Bankruptcy Law360 reported. Asarco first sued Grupo subsidiary Americas Mining Corp. in February 2007, arguing that Grupo Mexico's 2003 transfer of Asarco's 54.2 percent ownership in Southern Copper Corp., formerly Southern Peru Copper Corp., to AMC was fraudulent. Asarco contended that the sale, which allegedly undervalued Asarco's stake by almost $500 million, stripped the company of its most profitable division when it was needed the most. The transfer essentially pushed the company into bankruptcy court, it claimed. The company also alleged that Grupo Mexico bought out Asarco in 1999 specifically to obtain control of Asarco's ownership of the SPCC and put it out of reach of Asarco's creditors. Read more. (Subscription required.)
Wed., July 22, 2009
A small, troubled Spanish bank controlled by the Catholic Church is looking for a savior as it comes to terms with the massive loan losses that are shaking Spain's network of small savings banks, The Wall Street Journal reported. Cordoba-based CajaSur, which is headed by priest Santiago Gomez Sierra, said Tuesday it was in merger talks with larger and healthier savings bank Unicaja, which has traditional ties to the Spanish Socialist Party. Both are based in Spain's southern Andalusia region. Any deal would need the Bank of Spain's approval. CajaSur is struggling to digest a rapidly growing pool of souring loans from risky lending to once-mighty real-estate developers. It has the highest rate of nonperforming loans among Spanish banks, at 7.9% of total loans. CajaSur's position was weakened further in recent months after debt-rating firm Fitch Ratings downgraded CajaSur's debt to junk status, forcing the bank to seek €200 million ($284.5 million) in last-minute funding from the European Central Bank. CajaSur officials weren't available for comment. Read more. (Subscription required.)
Collins & Aikman Automotive Canada Inc. announced last week it applied for creditor protection under the Companies' Creditors Arrangement Act (Canada) in the Ontario Superior Court of Justice, Northumberland Today reported. "This (Companies' Creditors Arrangement Act) filing will allow the company to complete any potential sale transactions involving our Canadian Plastics operations," said John Boken, Collins & Aikman's chief restructuring officer. "Similar to our previous filing involving our Soft Trim operations, we expect to work closely with our customers, suppliers and employees, as well as the U. S. and Canadian courts to complete our restructuring efforts." Read more.