Skip navigation

COURT OKS VOTE SOLICITATION ON BRUNO'S REORGANIZATION

BIRMINGHAM, Ala. -- Bruno's here said last week the United States Bankruptcy Court for the District of Delaware has issued an order authorizing the company to solicit votes from creditors on Bruno's proposed plan of reorganization.Kravis Roberts & Co., New York.The bank reportedly alleged the $1.2 billion buyout deal was at the root of the financial problems that ultimately caused Bruno's to seek

BIRMINGHAM, Ala. -- Bruno's here said last week the United States Bankruptcy Court for the District of Delaware has issued an order authorizing the company to solicit votes from creditors on Bruno's proposed plan of reorganization.

Kravis Roberts & Co., New York.

The bank reportedly alleged the $1.2 billion buyout deal was at the root of the financial problems that ultimately caused Bruno's to seek Chapter 11 protection in February 1998. The bank reportedly said the leveraged buyout "appears to have involved fraudulent transfers of wealth" and other irregularities, according to the Associated Press.

The examiner, Harrison J. Goldin, partner in Goldin Associates, New York (and a former New York City comptroller), said in his report earlier this month it would be "extremely difficult to justify" an attempt to recover assets from the former stockholders of Bruno's and KKR.

Under the proposed reorganization plan, Bruno's senior creditors would receive shares of the company's common stock. Other general unsecured creditors would receive cash equal to 30% of their claims. No distributions would be made to the shareholders of Bruno's common stock.

Bruno's has said it will begin soliciting creditor acceptance by Oct. 31.