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[Commentary] © 2002 Philip Hyde, The Timesizing Wire™, Box 622 Cambridge MA 02143 USA (617) 623-8080

Bankruptcies, Jan-March/2002

3/27/2002  1 bankruptcy with $30m bond debt, mentioned in NY Times (NYT) & BG -

3/23/2002  1 bankruptcy totaling $?? debt, mentioned in NY Times (NYT) & BG - 3/22/2002  2 bankruptcies totaling $330m debt, mentioned in NY Times (NYT) & BG -
  1. Big builder in Germany is bankrupt - Most banks refuse to back new bailout, by Edmund Andrews, 3/22/2002 NYT, W1.
    Germany Inc. refused to rescue one of its own today, as the country's biggest banks and its political leaders watched the Philipp Holzmann construction conglomerate declare bankruptcy. Holzmann, once Germany's second-biggest construction company and one of its biggest employers, had already been bailed out twice in the last five years. But in Germany, big employers are often forgiven for extraordinary failures....
    Same as 'America Inc.' - remember the big Chrysler bailout of the 1980s? Same in 'Japan Inc.']
    Once one of Germany's most prestigious companies, [Holzmann] still employs 23,000 people and has been responsible for some of the biggest building projects in German history. But its problems have been festering for nearly a decade..\.. Many bankers and even many constructoin industry executives [of rivals? = no surprise] say that Philipp Holzmann should have been allowed to die a long time ago....
    In the fall of 1999 (11/23), the company...announc[ed] that it had uncovered nearly $2B in additional liabilities and would go bankrupt if it did not receive a huge infusion of cash. Deutsche Bank again came to the rescue....
    Despite the additional money [$1.95B], Holzmann was never able to turn a profit. Deutsche Bank offered to put up 50m euros toward a package of 200m euros [we'll just exchange these at par pending data - ed.], but the other big private banks could not be persuaded..\.. The willingness to let Holzmann collapse is a marked departure.... [Chancellor] Schroeder said he "greatly regretted" the fact that the banks had not agreed on a rescue package....
    [Guess so. Now he's got 23,000 more jobless Germans to drag down the economy.]

  2. Suprema Specialties, NYT, C4.
    ...Paterson, NJ, a maker of cheeses, received a judge's approval to change its Chapter 11 bankruptcy filing to Chapter 7 [liquidation] so the company can sell its assets. A group of banks that had lent the company $130m refused to keep its four plants running.

3/21/2002  1 bankruptcy, mentioned in NY Times (NYT) & BG - 3/20/2002  2 bankruptcies, mentioned in NY Times (NYT) & BG - 3/16/2002  1 bankruptcy, mentioned in NY Times (NYT) & BG - 3/10/2002  1 weekend bankruptcy story, mentioned in NY Times (NYT) & BG - 3/09/2002  1 bankruptcy, mentioned in NY Times (NYT) & BG - 3/08/2002  1 bankruptcy, with $185m debt, mentioned in NY Times (NYT) & BG - 3/07/2002  1 bankruptcy, with $310m debt, mentioned in NY Times (NYT) & BG - 3/06/2002  2 bankruptcies, one with $125m debt, mentioned in NY Times (NYT) & Boston Globe (BG) -
  1. Guilford Mills Inc., NYT, C4.
    ...Greensboro, NC, a maker of fabrics, [will] file for bankruptcy protection and seek court approval for a restructuring plan that would eliminate $125m in senior debt and give senior lenders 90% of the company's news stock....
    [Not to be confused with Guilford Transportation, the quite-solvent Massachusetts freight railway mentioned in our passenger-rail story on 10/18/2001 #2, or Guilford Pharmaceuticals (eg: 8/30/2000 #2). Bankruptcy serves ratfinky Guilford Mills right, sez we, cuz they been contributing to Ross Perot's "giant sucking sound" as American jobs get vacuumed across the border to Mexico - see 7/28/2000 #4. Fat lot of good this market-bashing method of "cost savings" did them!   Followup - "Guilford to close mills and trim its work force" on 4/23/2002 #5.]

  2. Formica files for bankruptcy protection, Bloomberg via NYT, C4.
    [Florsheim yesterday, Formica today - the pillars of the American economy are falling like tenpins. Beware, BEWAAARE, Americans - you see before you how "the first shall become last."]
    ...Make[r of] laminated countertops and flooring filed...yesterday, citing the economic slowdown, a burdensome debt and interest expenses. The company, based in Warren NJ [and] privately held, listed assets of $858.6m and debt of $816.5m..\.. The bankruptcy petition, which covers Formica and 9 related businsses, was filed in Manhattan....
    [The NYT misses the drama of this filing, but the Boston Globe catches it -]
    A new chapter for Formica: Chap. 11 - Facing deep debt, tough competition, fabled firm vows it will rebound, by Chris Reidy, BG, F1.
    Formica, which evolved into a home-decor product in 1931, the same year the Empire State Building formally opened and Al Capone went to jail, yesterday joined a list of consumer icons that has seen better days.
    [As we said about Florsheim yesterday, "another icon clasted."]
    In a distant era when young Americans wore Levi's and snacked on Cracker Jacks [that's "Crackerjack", Chris - and us old Americans/Canadians still wear Levi's tho' we're more likely to purchase Poppycock to snack on (we do miss the prizes)], Formica became the last word in laminated countertops. It time, it was virtually ubiquitous in American homes. It was as essential to the authenticity of an all-night diner as a recipe for 3-alarm chili or a sassy waitress....
    According to the...company, its woes are mostly about a leveraged buyout that left it deeply in debt....
    [Here, the lethal takeover-bankruptcy connection, which combined with the takeover-downsizing connection, will eventually result in the total banning of takeovers, These executive morons will have to manage, not merge, and win market share the honest and old-fashioned way and not by mere acquisition.]
    "Formica is one of the most powerful brand names in America"..\..said Frank Riddick, who recently took over as CEO.... A generation ago, homeowners who wanted to redo kitchens and bathrooms had few choices besides Formica, unless they wanted to use expensive stone or wood. \But\ competition...is a lot tougher today than it was [even] in the 1980s, when Formica was still a market leader....

3/05/2002  1 general, and 2 specific bankruptcy stories ($4.4231B debt), mentioned in NY Times (NYT) & Boston Globe (BG) -
  1. [the general story -]
    IMF mulls allowing bankruptcy filings, Bloomberg via BG, D4.
    WASHINGTON - The International Monetary Fund's board this week will begin discussing a plan to rewrite the rules of global finance by allowing nations to declare bankruptcy, amid opposition from experts who call the effort misdirected.
    [Whoah, this could render moot all campaigns for forgiveness of 3rd-world debt and a moratorium on collections, including rocker Bono's re African debt & collections.]
    ...IMF managing director Anne Krueger first outlined..\..the proposal...in December.... Krueger argues that her approach would help countries avoid economic collapse, encourage private capital flows to developing countries [or stop them completely - ed.], and eliminate multibillion-dollar bailouts the IMF has organized for countries from Mexico to Turkey....
    [But isn't that the IMF's whole purpose? To pour US taxpayers' money, without consulting them, into the pockets of the overseas affluent in the name of economic salvation?]

  2. [specific #1 -]
    Contractor in Japan is seeking bankruptcy, by Ken Belson, NYT, W1.
    TOKYO...- On the face of it, the collapse of the Sato Kogyo Co., one of the largest construction companies in Japan, was long overdue. The company, whose roots date to 1872, filed for court protection from creditors on Sunday with $4.42B in liabilities. It posted losses in 6 of the last 7 years, its stock traded for pennies, and the huge government and industrial projects it depended on are growing scarce.
    The news of Sato Kogyo's filing even struck investors as positive... the Nikkei stock index surged 5.9% [yester]day to a 6-month high, in part because the filing was seen by investors as a sign that Japan's largest banks are dealing with deadbeat investors.
    [Hey, whatever turns you on. But there's something under "the face of it" -]
    In the choreographed world of Japanese business, however, there is always more to a big bankruptcy than adverse market forces. Signs are that Sato Kogyo was allowed to fail to preserve the status quo, not to upset it. By sacrificing a big company that had little hope of a profitable future, the government gains political cover to encourage bailouts of many other large debtors.... "This is about politics, not economics," said Toshihiko Okino, a senior analyst at UBS Warburg Securities in Tokyo....
    The current mood is a far cry from 6 months ago, when the collapse of another fading giant, the retailer Mycal [see 9/15/2001], was heralded as a sign that PM Junichiro Koizumi's government had embraced the discipline of the market and would stop intervening to keep feeble companies from falling. But Mr. Koizumi's reputation as a reformer is fading fast.... Worried by unemployment, the government pushed in January for a bailout of Daiei Inc., a retailer, and regulators have since pressed Daiei's lenders to forgive even more debt....
    [So the self-styled "reformers" don't give a damn about unemployment and the collapsing consumer markets it entails, seemingly assuming that worksharing (aka Timesizing) is already in place to counter that collapse, and meanwhile Koizumi hasn't the insight to realize the power and centrality of the worksharing solution, despite recent discussions focused on it (and despite our recent email), so he continues brokering between the super-rich, presumably just keeping the centrifugation of wealth and income limited to a much higher level in the tax brackets.]

  3. [specific #2 - another icon clasted -]
    Florsheim Group files for bankruptcy and sells most assets, Bloomberg via NYT, C4.
    ...The maker and seller of men's shoes...founded by a cobbler's son, Milton Florsheim, in 1892, listed $156.7m in assets and $159.6m in debts in Chapter 11 papers filed today in Chicago, where it is based..\..after 4 years of losses.... The buyer [is] the Weyco Group.... Thomas Florsheim, the chairman of Weyco, which is based in Milwaukee, is the grandson of Florsheim's founder.
    [Hey, at least it's still in the family. Let's see, 159.6-156.7= $3.1m net debt.]

2/26/2002  2 bankruptcy stories, with $5.7384B debt, mentioned in NY Times (NYT) & BG -
  1. A spinoff of Williams may seek bankruptcy, NYT, C9.
    The Williams Communications Group, the troubled provider of broadband network services [is] looking to restructure its debt obligations and...might seek Chapter 11 bankruptcy protection from its creditors. [It] has $5.2B in outstanding debt, including about $2.4B in notes and other obligations owed to the Williams Cos., the energy services concern that spun [it] off...last year....
    [We'll stay tuned for the actual filing.]

  2. Mpower Holding will file for bankruptcy, Dow Jones via NYT, C9.
    ...A competitive local exchange carrier based in Rochester NY that provides telephone and Internet services to small and midsize businesses..\..said yesterday that an informal committee representing about 2\3 of bondholders had agreed to a recapitalization plan that included a Chapter 11 bankruptcy filing by the company.... The company said the plan would eliminate $538.4m in debt and all of its preferred stock. Mpower...came under attack last fall from a group of bondholders intent on persuading it not to deplete its cash reserves on expansion.

02/20/2002  1 general bankruptcy story, mentioned in NY Times (NYT) & BG - 2/19/2002  2 bankruptcies, with $21m + $?? debt, mentioned in NY Times (NYT) & BG -
  1. Chap. 11 filing roils student travel firms - Troubled Council cuts deal with rival [STA] to issue students tickets, buy assets, by Bruce Mohl, Boston Globe, D1.
    The multibillion-dollar student travel industry, shaken by the tourism slowdown after 9/11, is in turmoil following the recent bankruptcy of the largest student travel agency in the country. Without alerting its customers, Council Travel Services of New York, filed for Chapter 11...on Feb. 5, owing its 20 largest creditors more than $21m....
    Council was purchased by another student travel agency - Dublin-based USIT World - just prior to 9/11, but Council's bankruptcy attorney said those ties are now severed. ...Council claims its finances deteriorated when USIT World failed to pay $6.5m to Council's airline creditors..\.. With airlines reluctant to do business with the company, Council has struck a deal with STA Travel, the 2nd-largest student travel agency in the country, to have STA issue its tickets, provide a line of credit, and eventually buy most of the assets of the company. The purchase is subject to bankruptcy court approval....
    Student travel agencies offer special discounted fares to full-time college students. Council operates 77 offices across the U.S.... There are 2 Council offices in Cambridge MA and one on Newbury St. in Boston MA.... Several thousand student customers of foreign travel agencies have been stranded abroad as their companies have gone into receivership....

  2. Chap. 11 filing roils student travel firms..., by Bruce Mohl, Boston Globe, D1.
    ...Dublin-based USIT World...is now in receivership and STA [Travel], based in Australia, is reportedly planning to buy it as well. Irish press reports have suggested USIT's financial problems were caused by a downturn in Council [Travel]'s business following 9/11....
    [See that? With the right timing, you can each blame the other!]

2/16/2002  2 bankruptcies, with $2.77B +$?? debt, mentioned in NY Times (NYT) & BG -
  1. Globalstar files for bankruptcy protection, Bloomberg via NYT, B3.
    ...after spending more than $4B to build a satellite-telephone network that failed to attract enough customers and left Globalstar struggling to pay creditors. Globalstar, mostly owned by Globalstar Telecommunications and Loral Space & Communications, listed $573.4m in assets and $3.34B in debts in Chapter 11 papers filed in US Bankruptcy Court in Delaware.... The company...is based in San Jose, Calif....
    [Let's see: 3.34debts-0.5734assets= $2.7666B net debt.]

  2. Halliburton share rise after asbestos ruling, Bloomberg via NYT, B3.
    ...Judge Judith Fitzgerald of US Bankruptcy Court issued a restraining order after a Chapter 11 filing Thursday by the Harbison-Walker Refractories Co., formerly owned by \a\ Halliburton...construction subsidiary [VP Dick Cheney connection alert], Dresser Industries.... The judge's order delays asbestos claims for at least 2 weeks and signals that Halliburton's liabilities may be limited, analysts say.
    [Unspecified Harbison-Walker debt.]
    [Followup - Harbison-Walker's name is linked to multiple other names in bankruptcy notices in the WSJ (B3) and NYT (C5) on 1/07/2003: Global Industrial Technologies Inc, Indresco International Ltd, GPX (Foreign Sales/Forge(-Acquisition/-U)) Corp/Inc, Global Processing Systems Inc, TMPSC Inc, A.P. Green Industries/Services Inc, APG Development/Refractories/International Corp/Inc, Detrick Refractory Fibers Inc, Intogreen Co, Lanxide Thermocomposites Inc, Chiam Technologies Inc, RHI Services/Refractories (America) Inc, RHI America Receivables Corp. And CEOs think they are in any position to talk about "efficiency"? Ha! This kind of duplication bespeaks smokescreen and Dickhead Cheney, and Bushbrain, are in the thick of it. Sayonara, America. The Kondratieff "cycle" is beginning to look like a tide of lack of discipline that is more deadly when it's lack of discipline of management than when it's the lack of "discipline of the workforce" that one usually hears about (because it's the spoiled and insulated top managers speaking).]
2/12/2002  1 likely bankruptcy, with $932m in debt, mentioned in NY Times (NYT) & BG - 2/08/2002  1 bankruptcy, with $?? in debt, mentioned in NY Times (NYT) & BG - 2/06/2002  1 bankruptcy, with $?? in debt, mentioned in NY Times (NYT) & BG -
  1. Arthur D. Little plans bankruptcy filing, by Jonathan Glater, NYT, C4.
    ...The oldest consulting firm in the country,...which is based in Cambridge, Mass. \will\ file for bankruptcy protection as a precursor to its acquisition by an investment management firm...Cerberus Capital Management of New York....
    [Appropriately named - wasn't Cerberus the nine-headed dog of Greek mythology that guarded the gates of hell - mostly from people trying to get out?]
    Arthur D. Little [ADL], which was founded in 1886,...has a little more than 2,000 employees [and] like the rest of the consulting industry has experienced a slowdown over the last year, will keep its name....
    [Doesn't sound like that industry will be leading the much-predicted recovery, which seems to be harder-starting than Uncle Vern's outboard motor.]
    Analysts said the move did not surprise them because the firm had for some time struggled to improve its ability to convert R&D work into revenue.
    [Oh so familiar to Timesizing.com!]
    "I have called them the mad scientist of the consulting sector," said Jack Sweeney, an editor at Kennedy Information, which tracks the consulting industry....
    [Followup - apparently this bankruptcy plan was carried out, because an ADL bankruptcy auction is mentioned in "Navigant Consulting Inc.," 4/09/2002 NYT, C4.]

  2. Network Plus files Chap. 11 - Funding bid falls through for firm; 650 face job loss, by Peter Howe, BG, C3.
    ...A Randolph MA telecommunications service provider for 75,000 small business customers along the East Coast has filed for bankruptcy protection and plans to lay off 650 of its 1,000 employees this week. With the shakeout in the telecom sector showing few signs of easing, Network Plus...was driven to seek Chapter 11 bankruptcy protection by the refusal of creditors, including FleetBoston Financial, to come through with a crucial $40m in funding late last month.... "Our feeling was that we would have tgurned cash-flow positive with that $47m"..\..Robert Cobuzzi, Network Plus's CFO...said, but "the lenders decided they just didn't want to put more money into it"..\.. The once-booming market for competitive phone carriers has imploded and investors have fled the sector, forcing thousands of businesses to scramble and find new service. ...The 11-year-old company plans to auction off its assets within the next 3 or 4 weeks....
    [Doesn't sound like that industry will lead a recovery either. So it's back to weapons and coffins, or Timesizing.]

  3. ICH Corp., NYT, C4.
    ...San Diego, a holding company whose Sybra Restaurants unit franchises Arby's restaurants, filed for Chapter 11 bankruptcy protection.

2/05/2002  1 bankruptcy, with at least $83 in debt, mentioned in NY Times (NYT) & BG -
  1. Questron Technology files for bankruptcy, NYT, C10.
    ...An inventory and supplies management company has filed for bankruptcy protection...while the QTI Acquisition Corp. said it would buy the company.
    ["QTI" sounds a trifle too tailor-made to be on the level. But in the followup its listed as QUTI - even cuter.]
    QTI, a unit of Sun Capital Partners, said that it had agreed to assume about $81m of Questron Technology's debt and to keep the company's management team and its roughly 400 other employees....
    [So we're talking about at least $81m in debt.]
    [Followup - apparently there were a lot of other names associated with this bankruptcy -]
    Bankruptcies - In the US Bankruptcy Court for the District of Delaware - In re: QUTI Corp. f/k/a Questron Technology Inc., ...Comp-Ware Inc., Questnet Components Inc..., Integrated Materials Systems Inc, Power Components Inc, Power Too Inc, California Fasteners Inc, Fortune Industries Inc, Fas-Tronics Inc, Action Threaded Products Inc..., Capital Fasteners Inc, B&G Supply Co Inc..., debtors - Chapter 11...jointly adminstered..., legal notice, 12/18/2002 WSJ, B9.

  2. Etc...Fraser Papers Inc., Globe staff & wire services, BG, D2.
    ...of Stamford, Conn., would lend bankrupt Pulp & Paper of America $2m to maintain its idle mills in Berlin and Gorham, NH, under a plan supported by creditors and NH officials....
    [And here we're talking about at least $2m in debt.]

2/01/2002  1 bankruptcy, with $?? debt, mentioned in New York Times (NYT) & BG - 1/31/2002  1 bankruptcy, with $?? debt, mentioned in New York Times (NYT) & BG - 1/29/2002  1 bankruptcy, with $?? debt, mentioned in New York Times (NYT) & BG - 1/26/2002  1 bankruptcy, with $?? debt, mentioned in New York Times (NYT) & BG -
1/25/2002  1 bankruptcy, with $?? debt, mentioned in New York Times (NYT) & BG -
1/23/2002  1 story with 1 general and 1 specific bankruptcy, with $?? debt, cited in New York Times (NYT) & BG -
1/22/2002  1 specific and 1 general bankruptcy story, with $?? debt, mentioned in New York Times (NYT) & BG -
  1. Kmart expected to seek bankruptcy protection, pointer digest (to frontpage), NYT, C1.
    ...as early as this morning in Michigan, where it is based, according to advisers to the company.
    [It did - "Kmart files bankruptcy, largest ever for a retailer," by Hakim & Kaufman, 1/23/2002 NYT, C1, which states that "all 2,114 of its currently operating stores would remain open for now.... In filings with the Federal Bankruptcy Court in Northern District of Illinois, in Chicago, Kmart listed $16.29B in assets and $10.35B in debt."]
    The final straw was a decision by the Fleming Cos., a major food distributor, to halt most of its shipments to Kmart after not receiving its weekly payment.
    [And the real article -]
    Kmart is on verge of filing a claim for bankruptcy - Action may occur today [it did] - Retailer is putting together a plan to keep operating - Hurt by Enron fallout, by Stephanie Strom & Leslie Kaufman, NYT, frontpage.
    ...The nation's 3rd-largest discount retailer...would rank as the largest retail bankruptcy proceeding on record.
    [It does.]
    The record is now held by Federated Department Stores and a sister company, Allied Stores, which filed in 1990....
    Kmart, which operates roughly 2,100 stores, may use the bankruptcy to extricate itself from leases on about 250 of them around the country, retail analysts said....
    [And that could trigger a boomlet of baby bankruptcies. There's talk that this bankruptcy was prepped by Enron's bashing of confidence in surety bonds, which raised their cost while Kmart depended on them at their lower cost, but another article has a different story -]
    Despite throngs, indications of danger - Empty shelves and worried employees, by Greg Winter, NYT, C4.
    [Maybe if the employees spent less time worrying and more time stocking the shelves, instead of having to go back into the stockroom for everything. And then, of course, there's the stranglehold that Wal-Mart is tightening on global retailing and, the more concentration, the less diversity and, crucially, the less circulation. Followup -]
    Kmart gains permission to draw upon $2B loan, Bloomberg via 3/07/2002 NYT, C4.
    The Kmart Corp. won the permission of a federal bankruptcy judge to draw on a $2B loan, the biggest known for a company reorganizing under Chapter 11...."
    [In other words, Kmart filed. More followup -]
    Retail consultant says Kmart will seek to close 312 stores, by Constance Hays, 1/11/2003 NYT, B2.
    [That's after...]
    ...It closed 283 stores and laid off 22,000 workers last March [see 3/09/2002]....
    [Followup -]
    Kmart Corp. - New CEO [Julian Day] to be paid $1m following reorganization's end, 1/23/2003 WSJ, D5.
    [Here's a clue as to why the boom in bankruptcies - grotesquely overpaid executives indicate inadequate discipline of management (never mind 'discipline of labor' in the falling tide of the Kondratieff) and weak labor leverage due to huge manhour surplus in a job market radically changed by automation and robotization but without corresponding downward adjustments in the workweek. Management's interpersonal skills deteriorate as they can take more and more liberties without resistance from increasingly insecure employees, and as executives' frustration with flaccid markets increases, they resort to the shortcut of takeovers to "grow" market share instead of really growing it, which has naturally become tougher as technology-motivated downsizing and general manhour surplus has hammered wages. As executives scoop up more and more of the national income - left on the bargaining table by surplus labor constantly threatened with layoffs - they start thinking it's something they did that has resulted in this windfall, that they deserve infinitely more, and they don't notice their growing arrogance, insulation and isolation, let alone the fact that their subversion of democracy by buying politicians is clobbering the feedback system of their economies. The only problem with the top brackets having, we'll exaggerate so you can't miss it, 90% of the spending power in the economy, comes when they try to invest it in productivity that, drat it!, seems to require markets to sustain itself. So CEOs-become-investors blame quirky consumers, or those of their number who still haven't made their bloated boodle and have the misfortune to be still on the front lines as all this wonderful productivity is falling on flaccid markets.]
    [Yet more followup -]
    Lease-disposition extension is denied by bankruptcy judge, Dow Jones via 3/28/2003 WSJ, B3.
    ...A confirmation hearing on Kmart's reorg plan is set for Apr.14 [2003]. Once Kmart emerges from bankruptcy...expected by the end of April, it will have pared down its operations to about 1500 stores from the 2100 it had when it filed...during January 2002.
    [More followup -]
    Kmart expects to emerge, pointer blurb (to Col.6), 5/06/2003 WSJ, front page.
    ...from Chapter 11 today after 15 months, due in part to the efforts of hedgefund investor Edward Lampert.

  2. Japan: Increase in bankruptcies, by Ken Belson, NYT, C3.
    Corporate bankruptcies rose 1.9% last year, the 2nd-worst annual total on record. According to Teikoku Databank, a private credit agency, 19,441 companies failed last year, the most since 1984, leaving behind 16.2T yen ($123B) in liabilities.... A record 14 publicly listed companies were among those that collapsed \and 75%\ of the failures were because of the decline in the economy....

1/21/2002  1 bankruptcy, with $?? debt, mentioned in (NYT) New York Times & (BG) Boston Globe -
1/17/2002  2 bankruptcies, with $?? debt, mentioned in (NYT) New York Times & (BG) Boston Globe -
  1. The IT Group seeks Chapter 11 and agrees to sell assets, Bloomberg via NYT, C4.
    The Shaw Group has agreed to pay $105m in cash and stock and assume some liabilities to buy most of the IT Group, a harzardous waste manager...based in Monroeville, La..\..which filed for Chapter 11 bankruptcy protection yesterday....

  2. Harvard Industries, NYT, C4.
    ...Lebanon, NJ, a maker of vehicle parts, filed for Chapter 11 bankruptcy protection for the second time in 5 years.

1/15/2002  1 bankruptcy, with $600m in debt, mentioned in (NYT) New York Times & (BG) Boston Globe -
1/13/2002  1 nationwide-US bankruptcy story, mentioned in (NYT) New York Times & (BG) Boston Globe -
1/11/2002  2 bankruptcies with $?? in debt, mentioned in (NYT) New York Times & (BG) Boston Globe -
  1. Motient files for bankruptcy, by Simon Romero, NYT, C2.
    ...Operat[or of] a wireless communications network for users of BlackBerry hand-held computers, filed for bankruptcy protection yesterday....

  2. Museum Co. filing, Bloomberg via BG, D2.
    ...A retailer of museum replicas and art reproductions with 102 stores in 30 states and Canada, filed for bankruptcy protection after sagging sales left the company saddled with debt.... Its MuseumCompany.com Internet unit also filed for bankruptcy.
1/08/2002  1 bankruptcy with $?? in debt, mentioned in (NYT) New York Times & (BG) Boston Globe -
1/04/2002  1 general bankruptcy situation and 2 specific bankruptcies with $907.4m in debt, mentioned in (NYT) New York Times & (BG) Boston Globe -
  1. Bankruptcy record set in '01  -  255 public US firms filed, Web site says, Bloomberg via BG, D3.
    ...breaking the previous mark of 176 set in 2000, according to Boston-based *BankruptcyData.com..\.. At the height of a 1991 wave of bankruptcies, 123 public companies filed, the firm said..\..
    The amount of assets involved...in 2001 was $258.5B, more than doubling the previous record of $94.8B set the year before. Before 2000, the record...was $93.6B set in 1991. Enron Corp., which sought Ch.11...on Dec.2 with $63.3B in assets, was the largest-ever...topp[ing] Texaco's $35.9B Ch.11 case filed in 1987. After Enron, the next 5 largest bankruptcies in 2001 were Overall , 45 companies with more than $1B in assets sought to reorganize under Chapter 11 in 2001, more than doubling the previous record of 21 a year earlier.
    [Are you getting the feeling that either a too-high percentage of our captains of industry are incompetent or the incentives are wrong in our current economic design? Either the bar to bankruptcy is set too low or top execs stand to benefit too much regardless of this step, or both?]
    ..\..Bankruptcy filings generally follow the junk bond market, which peaked in the number of new issuances in 1998..\..said Barry Ridings...head of corporate restructuring at Lazard Freres & Co.... "There's typically a 2-3 year lag from time of issue to default," he said. "They don't call them junk for nothing."...
    [Then one might ask, Why do they exist at all? Is this merely another private-sector aspect of the bloated makework in our current primitive economic design, yet another bug that makes a mockery of our talk about "efficiency"? Until we solve our most basic contradiction, that between our esthetic desire for technological innovation and efficiency in production and our need for consumer markets (and therefore, 'dammit!', employees). Recall Ford's "Let's see you unionize these robots!" and Reuther's retort, "Let's see you sell them cars." Note that this was not a problem before, say, 1926, when, for a high percentage of people including business leaders, the desire for innovation and efficiency was not merely esthetic but defining of our concept of progress = making life easier for everyone = higher pay and shorter hours. If we allow roughly 50 years of American industrialization to define the contradiction (1776=Declaration of Independence, 1826=Sismondi's second edition), then there was another 100 years during which we were still getting the solution roughly right (1926=jerky downward adjustment of American workweeks and accompanying income centrifugation no longer fast enough to indefinitely postpone chronic-depression-clinching bubble&burst). But then the Gospel of Consumption took over, which meant the short-sighted substitution of 'work hard to get ahead', where 'hard' is defined as long hours vs., say, 'work smart not hard', and 'ahead' is defined as 'buy more stuff' vs., say, free up more of your life from others' control alias 'work'). This whole fateful and fatal process is described by Ben Hunnicutt in his wonderful Work Without End - Abandoning Shorter Hours for the Right to Work (Temple U: Philly, 1988) - just look up "Gospel of consumption" in the index. (Unfortunately, the wealth-insulated captains of industry did not realize that the "right to work" equated for most people to the right to live and longer hours set us all on the path to family neglect on one hand and runaway consumption on the other. So, the toxic trilogy of equating life to long workhours, family neglect and runaway consumption guaranteed that our effective solution to the Big Contradiction would shift from work sharing to makework, and makework in its most angry form, militarization. Hitler led the way by solving Germany's depression and a number of its other problems (high debt, low morale....) by massive militarization, and he ultimately succeeded in forcing us to follow suit. And how ecological and sustainable was World War II, triggered by the outward explosion of fascist Italy in 1935, the Third Reich in 1938 and Europhile Meiji Japan in 1941 and featuring the extermination of 30m Ukrainian, 6m Jewish and 2.5m German civilians (the Germans during an unpublicized botch = postwar forced-repatriation of 16.5m {Colliers 9:42a} ) during and after the war, not to mention such ecological wartime wow-ers as the firebombing of Dresden and the nuking of Hiroshima and Nagasaki? Since then we've had wars large and small - Korea, Vietnam, Grenada, Panama, the Falklands, Desert Storm, Afghanistan - all for lack of a new sharing technology that would enable us to solve The Big Contradiction on a long-term sustainable basis. Our solution candidate is summed up in the phrase Timesizing, Not Downsizing.]

  2. Judge approves Chapter 11 plan for Carmike Cinemas, Bloomberg via NYT, C3.
    ...that restructures about $650m in debt.... Carmike, which has more than 300 theaters in 35 states, sought Chapter 11 protection...in Delaware in August 2000 after failing to make $9m interest payments to bondholders....
    [Mentioned, but not counted, in our 11/16/2000 #3 story.]

  3. Anacomp completes a Chapter 11 restructuring, Bloomberg via NYT, C3.
    ...Provide[r of] digital document-management services using the Internet and other technologies, filed for bankruptcy protection in October, listing assets of $211.8m and debts of $469.2m....
    [Somehow missed this one too. The debt is 469.2-211.8= $257.4m.]

1/03/2002  1 bankruptcy, with $1.1B in debt, mentioned in (NYT) New York Times & (BG) Boston Globe - 1/1/2002  3 bankruptcies, with $300m +?? in debt, mentioned in (NYT) New York Times & (BG) Boston Globe -
  1. 2 telecommunications operations file for Chapter 11, Reuters via NYT, C3.
    The energy holding company Great Plains Energy Inc. said yesterday that two of its telecomms units would file for...bankruptcy protection in a restructuring that would eliminate $300m in debt and narrow the units' operations. The Great Plains units, Digital Teleport Inc. and its holding company, DTI Holdings, are 83%-owned by KLT Telecom, which in turn is a unit of KLT Inc., a Great Plains subsidiary that invests in energy ventures that are not regulated....
    ["Oh what a tangled web we weave."]

  2. Olympic Cascade Financial Corp., NYT, C3.
    ...Seattle, a securities brokerage firm, said its WestAmerica Investment group had stopped conducting business as a broker-dealer and would file for Chapter 7 bankruptcy [i.e., liquidation]....

  3. Transit Corp., NYT, C3.
    ...Atlanta, a trucking company that operates in 48 states and Canada, filed for Chapter 11...and said it expected to bankruptcy financing from its largest shareholder, the GE Capital unit of General Electric Co., Fairfield, Conn.

For earlier bankruptcy stories, click on the desired date -

  • Aug-Dec/2001.
  • Mar-July/2001.
  • Jan-Feb/2001.
  • Dec/2000.
  • Oct-Nov/00.
  • Jul-Sep/00.
  • Jan-Jun/2000.
  • Aug-Dec/1999.
  • Prior to July 31/99.

    For more details, see our laypersons' guide Timesizing, Not Downsizing, which is available online from *Amazon.com and at bookstores in Harvard and Porter Squares, Cambridge, Mass.

    Questions, comments, feedback? Phone 617-623-8080 (Boston) or email us.

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