24 January 2013 22:51 [Source: ICIS news]
HOUSTON (ICIS)--US-based catalyst producer WR Grace will take a charge of $365m (€274m) in its fourth-quarter earnings because of an increase in its recorded asbestos-related liability, the company said on Thursday.
That liability is increasing to $2.065bn from $1.700bn, WR Grace said.
The $365m non-cash, pre-tax charge will not affect the company's adjusted earnings before interest and tax (EBIT), the company said.
WR Grace is increasing its asbestos-related liability because the company now expects an increase in the settlement values of warrant and deferred-payment obligations, the company said. The obligations are payable to the company's asbestos personal-injury trust under WR Graces reorganisation plan.
A reorganisation plan provides a road map for how a company would emerge from bankruptcy protection.
WR Grace filed for bankruptcy protection under Chapter 11 in 2001 after being overwhelmed by asbestos lawsuits.
At the time of its bankruptcy filing, the company faced 65,656 such cases involving 17 property-damage claims and more than 129,000 personal-injury claims.
In January 2011, the US bankruptcy court in Delaware confirmed the company's reorganisation plan.
The following year, a US District Court affirmed the ruling from the bankruptcy court.
Despite these milestones, the company continues to operate under bankruptcy protection because litigation is still pending in the Third Circuit Court.
So far, oral hearings are scheduled for the first quarter, the company said. A ruling could be handed down in the third quarter.
However, the court will issue its ruling on its own timeframe.
($1 = €0.75)
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