High Shipping Costs Are Here to Stay, Says Bloomberg
By Henry Ren (Bloomberg) Stubbornly high shipping expenses for businesses are getting sealed into contracts for the next 12 months, forcing companies to pass the extra costs on to consumers....
Details of the alleged debt weren’t immediately available from Kurtzman Carson Consultants LLC, the agent processing claims for Overseas. The company’s 8.125 percent bonds due in 2018 fell as much as 23 percent today to 30 cents on the dollar, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.
“The bonds could be worth zero or very little if that claim were sustained,” Oliver Corlett, an analyst at RW Pressprich & Co. in New York, said by phone.
The claim was filed with Kurtzman Carson on Feb. 11. The IRS labeled the claim a priority, meaning that the agency believes it should be paid ahead of other unsecured and lower- ranking debts.
The New York-based company filed for bankruptcy last year after global shipping rates fell and the company gave up trying to win a federal loan guarantee. Overseas listed assets of $4.15 billion and debt of $2.67 billion in its Chapter 11 petition in U.S. Bankruptcy Court in Wilmington, Delaware.
Daniel H. Golden, an attorney for Overseas with law firm Akin Gump Strauss Hauer & Feld LLP, didn’t immediately return a call seeking comment on the claim.
In bankruptcy, companies have the right to challenge claims filed by creditors. In this case, should the IRS prevail, the claim would outrank the claims of bondholders, Corlett said.
The case is In re Overseas Shipholding Group Inc., 12- bk-20000, U.S. Bankruptcy Court, District of Delaware (Wilmington).
– Steven Church and Alaric Nightingale, Copyright 2013 Bloomberg.
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