Delphi, the automotive parts maker that was spun off from General Motors, has finally emerged from its stay in bankruptcy after a protracted four-year stint with bankruptcy protection as the company got its financials back in order. According to the company, the final push to get Delphi out of bankruptcy involved the sale of assets to lenders and to General Motors, its parent company.
The new company, post-bankruptcy, will be called Delphi Holdings, and its newfound stability comes as a great relief to General Motors. GM has spent plenty of money to make sure that Delphi’s reorganization went through smoothly, placing …read more

Personal bankruptcies hit a four-year high, topping the one million mark during the first nine months of 2009. According to the report issued by the American Bankruptcy Institute (ABI), the numbers increased 35% over the same period in 2008.
According to ABI, there were 1,046,449 personal bankruptcies in the first nine months of this year — the highest since 2005 when 1,350,360 consumer bankruptcies were filed. Approximately 71% of those who filed for bankruptcy in the first nine months of 2009, filed Chapter 7.
In 2005, the obvious reason for the large number of bankruptcies was change in the bankruptcy law. However …read more

I love The Office. And one of my favorite episodes involves a debt-ridden Michael Scott trying to declare bankruptcy. As you can see, though, it doesn’t exactly go well:
Michael was looking for a quick and relatively painless solution to his money problems. However, bankruptcy usually isn’t the answer to such problems. Even though you can get some protection from your debts through bankruptcy, recent laws mean that you can’t discharge everything that you might like to. And bankruptcy might not even be the best choice. It might be better for you in the long run to try and get out …read more

One of the main causes of bankruptcy is medical bills. It’s nice to think that most of the people declaring bankruptcy are doing so because of credit card debt and out of control spending, but many of them are actually doing so because of medical bills. (Credit card debt probably has something to do with it, but $5,000 on credit cards is usually nothing compared to a $30,000 hospital bill.) A good chunk of those who have financially catastrophic medical bills have insurance. Or had insurance.
This state affairs illustrates the financial risk of losing health coverage. If you have health …read more

I really enjoy The Office. One of the recurring themes in the show is that Michael Scott is something of an incompetent manager. However, the people working under him manage to do reasonably well in spite of his ineptitude. One of the funnier things that happens in an episode of The Office is that Michael tries to declare bankruptcy by yelling the word at his co-workers.
Well, as you know, there is more to it than that.
When you declare bankruptcy as a business, you need to go through special paperwork and protection. In some cases, if you plan to restructure as …read more

General Motors Co. has decided to wind down the operations of its Saturn brand, GM’s answer to Japanese automakers that was started 24 years ago. While GM had originally intended to sell Saturn to Penske Automotive Group, the latter pulled out of negotiations with GM and has forced GM to make this decision.
Penske, which operated 310 auto retailers, backed out of the deal because it was concerned that it would not have access to new vehicles in 2011 when GM was expected to stop supplying them. Its inability to sell the Saturn brand has forced GM to adapt its post-bankruptcy …read more

In a move that significantly outpaces Republic Airways Holdings’ bid of $108.8 million for Frontier Airlines, Southwest Airlines has decided it can spend $170 million to acquire Frontier and bring it out of bankruptcy. As far as whether or not Southwest can maintain its bidding lead, Republic has not lost hope in acquiring Frontier.
 
Republic’s spokesperson, Carlo Bertolini, stated that his company will be present at the next bankruptcy court auction, but did not suggest that Republic was dead set on bidding. Southwest, though, hopes to win control of its rival uncontested, allowing it to give service to several more cities …read more

Oscient Pharmaceuticals has filed for Chapter 11 bankruptcy in the state of Massachusetts. Also included in the filing is Guardian II Acquisition Corporation — a wholly owned subsidiary.
During the bankruptcy proceedings, Oscient Pharmaceuticals and Guardian II Acquisition Corporation will continue operating and managing their everyday business activities and assets.
While Oscient Pharmaceuticals currently has two products, Antara and Factive, the company has also announced that they have sold the Factive product to Cornerstone Therapeutics Inc. for $5 million and five years of royalties. The closing of the sale depends on approval from the bankruptcy court. The company didn’t say whether they …read more

General Motors, once the world’s largest automaker, has fallen far from its lofty perch and into bankruptcy. However, GM emerged from bankruptcy two days ago and it is already promising to make sweeping changes in addition to the dramatic changes it has already made to try to reclaim at least a bit of its former glory.
 
The historic automaker has the federal government to thank for surviving one of the largest bankruptcies ever due to the $50 billion worth of taxpayer money that the government has invested into GM. That does not mean that GM will not have to work hard …read more

Before the global economic crisis, GM and Toyota jointly operated the New United Motor Manufacturing Inc. (NUMMI) plant in California. GM’s bankruptcy and restructuring, though, has led it to pull out of the vehicle-assembly plant, leaving Toyota to decide whether or not it will be a wise decision to renew its contract with the manufacturers.
 
GM and Toyota established the NUMMI operation in 1984, but ever since then, the venture has mostly lost money for both companies. Toyota posted in first annual loss in 58 years last year, marking relatively dire straits for a historically successful company. Slow vehicle sells and …read more