Magnesium Corp of America & Renco Metals, Inc

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On August 2, 2001 (the "Petition Date"), Magnesium Corporation of America and Renco Metals, Inc. (the "Debtors") filed voluntary petitions in the United States Bankruptcy Court for the Southern District of New York seeking relief under the provisions of Chapter 11 of the United States Bankruptcy Code.

On September 24, 2003, the Debtors' chapter 11 cases were converted to chapter 7. On September 24, 2003, Lee E. Buchwald was appointed as chapter 7 Trustee to the Debtors. 
This website was created to assist the Trustee in providing access to information for creditors, as well as to solicit and receive comments from such creditors.

Telephonic inquiries can be made at: 888-204-0640

An agreement in principle on the terms of a global settlement was reached in November 2018 with the three major creditors in these cases (the Indenture Trustee Parties, the Federal and Utah State Governments and the Renco Parties), and was disclosed in the Chapter 7 Trustee’s Thirty-Third Interim Status Report filed on December 4, 2018 [Docket No. 1118]. While the parties still support the terms of the global settlement, it has unfortunately taken far longer than expected to finalize because of (a) the five-week government shutdown that occurred between December 21, 2018 and January 25, 2019, and (b) the complexities relating to the environmental issues being resolved between the Federal and Utah State Governments and the Renco Parties, which are solely inter-creditor issues that do not affect the Debtors’ estates or other creditors.

As disclosed in his Reports filed with the Court since November 2017, the Chapter 7 Trustee has expended significant time and resources in trying to broker a settlement that includes all the major parties - the Governments, the Indenture Trustee (as instructed by the Required Noteholders) and the Renco Parties, recognizing that a partial settlement would likely be hotly contested by any of those three parties who were not included, leading to endless litigation which would clearly cause significant delay and expense.  Unfortunately, as a result of the unforeseen delays in finalizing the global settlement, the Chapter 7 Trustee has determined in his business judgement to bifurcate the global settlement, so that all of the issues that are capable of being resolved at this time are resolved. To accomplish this, on May 7, 2019, the Trustee filed a motion to approve the settlement relating to Indenture Trustee Claims, Trade Claims, and administrative and priority claims, as memorialized in the Settlement Agreement attached to the Motion as Exhibit A [Docket No. 1132] (the “Settlement Agreement”). All open issues (including the complex environmental issues that have caused the delay) are deferred for a separate agreement currently being negotiated among the Governments, the Renco Parties and the Chapter 7 Trustee. 

Under the proposed Settlement Agreement, on the effective date thereof, the Chapter 7 Trustee will disburse over $49 million as follows:  (a) $774,347.56 to fully satisfy Chapter 11 administrative expenses (other than the claims of the Governments) and prepetition priority claims; (b) $47,231,796 in full satisfaction of the claims of the Indenture Trustee; and (c) $1,201,024 in full satisfaction of the claims of Trade Creditors.  The approval of the Settlement Agreement will allow the Chapter 7 Trustee to finally make a long awaited distribution to the unsecured creditors who suffered a cognizable pecuniary loss.

At this time, the Chapter 7 Trustee does not believe that the Governments and the Renco Parties will support the Settlement Agreement. Nevertheless, the Settlement Agreement is the only path that makes sense under the present circumstances, and is the most expeditious and efficient way to move the settlement process forward, hopefully culminating in the fully complete global settlement.  While the Chapter 7 Trustee is fully prepared to move forward with the Settlement Agreement motion on June 12, he continues to hope that the filing of the motion will provide the needed impetus to finally implement the global settlement that is supported by all major constituencies.

While the Chapter 7 Trustee is fully prepared to move forward with the Settlement Agreement motion at the June 12, 2019 hearing, he continues to hope that the filing of the motion will provide the needed impetus to finally implement the global settlement that is supported by all major constituencies.  If the Settlement Agreement is approved at the June 12 hearing, the Trustee expects to make final distributions to the Indenture Trustee and all Trade Creditors in mid-June.  The Trustee will update this webpage as developments unfold, so creditors are urged to return periodically.

Main Debtor 01-14312 Magnesium Corporation of America
Total Number of Debtors 2
Court Southern District of New York
Judge Hon. Mary Kay Vyskocil
Chapter 7
Petition Filing Date August 2, 2001
Claims Bar Date March 1, 2017
Chapter 7 Trustee Lee E. Buchwald
Buchwald Capital Advisors LLC
380 Lexington Avenue, 17th Floor
New York, NY 10168-1799
Phone: (212) 551-1040
(Website)
Attorneys for Trustee Stevens & Lee, PC
485 Madison Avenue, 20th Floor
New York, NY 10022
Phone: (212) 319-8500
(Website)     (Contacts)
© 2019 - Omni Management Group.





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