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March 16, 2010 5:46 PM

The Bankruptcy Files: Casinos, REITs, and Trash Haulers

Posted by Brian Baxter

While the Lehman Brothers bankruptcy has been grabbing all the headlines recently, other Chapter 11 cases proceed apace.

Lawyers from Kirkland & Ellis filed an amended reorganization plan for auto parts supplier Visteon on Monday, while attorneys at Weil, Gotshal & Manges working for the parent company of the Pizzeria Uno restaurant chain filed their own reorganization plan as part of a process to transfer ownership to senior lenders.

Weil is also advising Extended Stay Hotels in its ongoing Chapter 11 case. While the examiner's report in the Lehman case had the bankruptcy bar buzzing as soon as it was made public on March 11, an examiner in the Extended Stay bankruptcy filed his report under seal on Friday, according to Bloomberg.

In his report, Extended Stay examiner Ralph Mabey addressed claims that two private equity firms schemed with senior lenders to force the Spartanburg, S.C.-based hotel chain into what Bloomberg reports is the largest bankruptcy ever by a U.S. hotel owner. Bloomberg also reports that Mabey, a former bankruptcy judge and senior of counsel with Los Angeles's Stutman Treister & Glatt, needs to get waivers before disclosing information received under confidentiality agreements.

On Tuesday, reports began circulating following an SEC filing by Blockbuster that the video rental chain could go bankrupt. In late February we reported on the battle between Kirkland and Weil for Blockbuster's restructuring work.

The latest bankruptcy filings and their lawyers are as follows:

Anthracite Capital

A real estate investment trust (REIT) owned by investment management firm BlackRock filed for Chapter 7 liquidation on Monday three months after defaulting on its debt, according to Reuters. Anthracite Capital was delisted from the New York Stock Exchange as bad real estate loans and debt bought from other lenders consumed its balance sheet.

Skadden, Arps, Slate, Meagher & Flom corporate restructuring cochair J. Gregory Milmoe is advising Anthracite in its liquidation. The firm has a long-time releationship with Anthracite's external manager, BlackRock, having recently advised the company on its $13.5 billion acquisition of Barclays' investment unit in June.

Albert Togut, a name partner at New York bankruptcy boutique Togut, Segal & Segal, has been appointed liquidating trustee for Anthracite. The firm served as conflicts counsel to Chrysler in its bankruptcy case last year.

Centaur LLC

A minor revival for all things centaur--who can forget tabloid reports that baseball star Alex Rodriguez may have a spiritutal affinity for the half-man, half-horse figure of Greek legend--suffered a setback earlier this month when casino owner and operator Centaur LLC filed for bankruptcy in Delaware.

Indianapolis-based Centaur, which owns Indiana's Hoosier Park casino and racetrack, is seeking a buyer for its Fortune Valley Hotel & Casino in Colorado and wants to restructure $574 million in debt, much of which was incurred building the Valley View Downs casino and racetrack in western Pennsylvania.

White & Case financial restructuring partners Gerard Uzzi, Michael Shepherd, and Scott Greissman are serving as lead debtors' counsel. Fox Rothschild bankruptcy partners Jeffrey Schlerf and Eric Sutty are acting as Delaware counsel to Centaur. The two attorneys joined Fox Rothschild last year from Delaware firm Bayard.

Neither firm has yet filed billing statements with the bankruptcy court.

EnviroSolutions

Trash hauler and landfill operator EnviroSolutions and 21 of its affiliates filed for bankruptcy last week, according to Bloomberg. EnviroSolutions announced a prepackaged agreement with senior lenders that will see them take over the Manassas, Va.-based company, which was hurt by a recession-fueled decrease in waste volume.

Willkie Farr & Gallagher bankruptcy partner John Longmire is serving as lead debtor's counsel. The firm has not yet submitted billing statements with the bankruptcy court.

Reuters reports that EnviroSolutions has sought bankruptcy court approval for a $30 million debtor-in-possession facility, but expects to have enough cash on hand to fund its operations while in Chapter 11.

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