Headlines

An official committee of unsecured creditors has objected to bankrupt racetrack betting operator Magna Entertainment Corp.'s attempt to sell several racetracks and its Internet gambling business to an entity owned by its CEO, arguing the proposed $180 million deal is rife with conflicts of interest, Bankruptcy Law360 reported. In an omnibus objection filed Wednesday in the U.S.

A Quebec court has extended protection for Shermag Inc. until July 13, giving the struggling furniture maker more time to develop a business plan that's acceptable to its creditors, The Canadian Press reported. Shermag manufacturers and imports residential furniture for the domestic and U.S. markets. Like many Canadian companies that depend heavily on exports to the United States, Shermag has been hurt by the weak U.S. economy--particularly a decline in the housing sector.

Bob Bangerter has been adjudicated bankrupt by a New Zealand court for the second time. Sir Robert Jones' company, Robt Jones Holding, had applied to bankrupt the Blue Chip co-founder because the company was owed $395,000 of unpaid rent for an Auckland office block where Blue Chip operated from. The 72-year-old Mr Bangerter had signed personal guarantees for the lease on the premise. Mr Bangerter was not represented in the High Court at Auckland today--his partner Maree Aitkenhead said he could not appear in court due to ill health.

The former chief financial officer of Satyam Computer Services Ltd., the Indian software services firm mired in a corporate scandal, has said that the company's auditors from PricewaterhouseCoopers weren't complicit in the giant fraud, according to the president of the Institute of Chartered Accountants of India.

A local Swedish court on Monday granted General Motors' loss-making unit Saab an extension of the period it is protected from creditors, giving it further time to restructure, Reuters reported. The Swedish carmaker, which sought protection from creditors in February, outlined plans for its continued reorganisation, including a reduction of non-prioritised debt by 75 percent, at its first formal meeting with creditors earlier on Monday. "The court has decided that the reconstruction can continue until May 20 at the latest, if no other decision is taken before then," the court said.

Caja Madrid may be the first Spanish bank to stop interest payments to mortgage-backed bond investors as loan defaults soar, according to Standard & Poor’s. Homeowners lagged behind on repayments on 72 billion euros of mortgages as of January, Bank of Spain data show, after the credit crisis halted a real-estate boom. “A number of deals” may have to defer interest, said Dipesh Mehta, an asset-backed debt analyst at Barclays Capital in London. “Unemployment is the biggest risk” to Spanish mortgage bonds, he said.

Chinese restaurant Canton Wok in Joo Chiat has closed and its chef-owner Ang Song Kang, popularly known as Chef Kang, has had to file for bankruptcy after a failed business venture in China, The Straits Times reported. The 44-year-old chef tells Life! he invested in a Guangzhou motor and machine oil plant in 2005 with two Chinese nationals. He had known one of them for about three years. He invested $200,000 of his savings in the business and got a 25 per cent stake in it.

Troubled Austrian real estate group Immofinanz plans to swap €1.5 billion ($2 billion) worth of convertible bonds into new convertibles at a lower face value to avoid insolvency, it said on Monday. The group, which has been fighting a liquidity squeeze by selling assets and other measures since last year, is offering holders of five outstanding convertibles new bonds worth €600 million, it said in a statement. The new convertibles, which would mature in 2011, will be guaranteed by Immoeast, Immofinanz's emerging European arm.

Grupo Mexico SAB, Mexico’s largest mining company, was ordered by a U.S. judge to pay Asarco LLC about $6 billion in damages over a lawsuit related to Asarco’s bankruptcy case, Bloomberg reported. U.S. District Judge Andrew Hanen in Brownsville, Texas, yesterday ruled that Grupo Mexico must return Asarco’s 30 percent stake in Peruvian copper miner Southern Copper Corp. and pay $1.9 billion in related dividends and interest. Hanen found Aug. 30 that Grupo Mexico’s Americas Mining Corp. unit harmed Asarco creditors by stripping the company’s stake in Southern Copper.

Cash flows of Indian auto-parts makers could be affected if General Motors Corp. files for bankruptcy, industry executives said Thursday. Members of the Automotive Component Manufacturers Association of India, or ACMA, export about $1 billion worth of parts to top suppliers and vehicle makers in the U.S. "There could be a hit," ACMA President Vishnu Mathur told Dow Jones Newswires. "Outstanding payments to suppliers are usually the last priority.