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Owens Corning wins extension to exclusivity period

Owens Corning won a six-month extension on 20 December 2004 to its exclusivity period, during which the company enjoys the sole right to solicit votes in favor of its Chapter 11 plan of reorganization…

Owens Corning won a six-month extension on 20 December 2004 to its exclusivity period, during which the company enjoys the sole right to solicit votes in favor of its Chapter 11 plan of reorganization. US Bankruptcy Judge Judith Fitzgerald said she would give Owens Corning at least until 30 June 2005 to solicit creditor support for its proposed plan to emerge from Chapter 11. The building materials maker“s “exclusive solicitation period” was due to expire on 31 December 2004, leaving Owens Corning open to competing plans at a crucial point in its long-running bankruptcy. Owens Corning lawyer Norman Pernick, said the company is headed into contested hearings over how much it should allocate to pay asbestos damages claimants, and that other matters that will shape the future of the bankruptcy case remain undecided. Pernick said that given all the activity in the case, it is not certain that Owens Corning will have its plan ready for voting by the middle of 2005. “We will try to get it done,” the lawyer said. Holders of bank debt had challenged the granting of a longer exclusive period. They argued that the company“s Chapter 11 proposal could unravel if the bank group wins an appeal of a federal court ruling that Owens Corning and its subsidiaries should be considered as a single entity. The ruling on the consolidation issue by US District Judge John Fullam in October 2004 favors Owens Corning“s proposed exit scheme. At a hearing in Pittsburgh, Fitzgerald said she would require Owens Corning to return to court and prove why it should be left in sole charge of mapping out the company“s future, if an appeals court reverses the district court decision on consolidation.

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