US bankruptcy court confirms Pittsburgh Corning reorganisation plan

28 May 2013 15:20  [Source: ICIS news]

HOUSTON (ICIS)--The US Bankruptcy Court for the Western District of Pennsylvania has issued a final order confirming the current reorganisation plan for Pittsburgh Corning, US coatings and specialty products firm PPG Industries said on Tuesday.

The court had previously issued an interim order confirming the plan.

PPG and Corning are each 50% shareholders of Pittsburgh Corning, which filed for Chapter 11 bankruptcy protection in 2000 because of asbestos-related claims.

Under the terms of the plan, which includes PPG's asbestos settlement arrangement, all current and future personal injury claims against PPG relating to exposure to asbestos-containing products manufactured, distributed or sold by Pittsburgh Corning will be channelled to a trust for resolution, PPG said.

The final confirmation order will be subject to a customary appeals process and, if the confirmation order is upheld and all conditions are met, the plan of reorganisation will become effective, the company said.

Under the plan, PPG and its participating insurers are to make their initial payments to the trust 30 business days after the plan becomes effective and all conditions to funding have been met, it added.

PPG’s obligation to the trust consists of cash payments totalling about $825m (€635m), to be made according to a fixed payment schedule over a period ending in 2023, about 1.4m shares of PPG stock or cash equivalent, and surrendering its shares in Pittsburgh Corning and Pittsburgh Corning Europe.

As of 31 March, PPG’s accrued liability related to the settlement arrangement was about $800m.

In addition to PPG’s obligation to the trust, the company’s participating insurance carriers are to make cash payments to the trust of approximately $1.7bn in a series of payments ending in 2027, PPG said.

Pittsburgh Corning had filed for bankruptcy protection because of lawsuits alleging personal injury from exposure to asbestos. The company made asbestos-containing pipe insulation from 1962-1972.

Additional reporting by Al Greenwood

($1 = €0.77)

By: Stefan Baumgarten
+1 713 525 2653

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