Keystone Consolidated unsecured creditor objects to disclosure statement

By Caroline Salls

Pittsburgh, June 24 - Keystone Consolidated Industries, Inc.'s disclosure statement for its plan of reorganization drew objection from general unsecured creditor Siena Capital, LLC, according to a Friday filing with the U.S. Bankruptcy Court for the Eastern District of Wisconsin.

Siena, which holds a $5.7 million claim for Keystone's 9 5/8% senior secured notes due 2007, said the two-day period between the filing of the second amended disclosure statement and the hearing did not give creditors enough time to analyze the data and determine what revisions were necessary, especially in respect to valuation and feasibility of the plan.

The creditor said the enterprise value is "grossly" understated based on EBITDA projections for 2006 and 2007.

Also, Siena said there is no disclosure of presumed discount rates, assumed future cash flows or other variables used in valuation.

"Without a meaningful opportunity to review the underlying valuation data, it appears as if the valuation were simply arrived at in order to ensure that Contran would obtain a controlling equity interest in exchange for its debt claims," the filing said.

Keystone, a Dallas-based fencing and wiring company, filed for bankruptcy on Feb. 26, 2004. Its Chapter 11 case number is 04-22422.

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