Whitton to Seek OK for Plan After Stay Relief is Denied

October 11, 2011 – In The News
The Deal Pipeline

Bankrupt Whitton Corp. is one step closer to reorganizing after a judge ruled that the real estate company's merger of 20 of its single-asset entities into Whitton Corp. two days before filing for Chapter 11 bankruptcy is legitimate.

The case has been a controversial one, but Judge Bruce Markell denied the stay relief request made by creditors, saying the merger was a legitimate way to reorganize.

Under the single-asset real estate process, the debtor has 90 to either file a reorganization plan or start making interest payments. A bankrupt company with more than one real estate asset has more time to put together a reorganization plan and creditors have less power to block the plan, which is why Whitton Corp. merged.

Baume says Markell has scheduled a disclosure statement hearing for December 14, 2011 and upon approval of it, he's set the confirmation hearing for January 30 and 31, 2012.