According to an article in the Dallas Morning News , Idearc, Inc. bondholder (MatlinPatterson Global Opportunity Partners) is challenging the viability of the company’s bankruptcy exit plan and is asking the bankruptcy court to strip control of the bankruptcy case from the publisher.
“Idearc’s proposed bankruptcy exit plan is based on an agreement it struck with senior lenders before filing for Chapter 11 protection in March. The plan hands 95 percent of the reorganized company’s stock to lenders, while leaving the remaining 5 percent for unsecured creditors, including bondholders. Unsecured creditors sued, alleging that the value of the lenders’ collateral is far less than they claim.”
If Idearc is unable to resolve resolve the dispute regarding their bankruptcy exit plan, the bankruptcy court may allow creditors and bondholders to propose their own plans for the company. Losing control of the bankruptcy exit plan could be a devastating blow for the publisher. But the company insists that is making progress in negotiations with its unsecured creditors.