MTS pre-packaged Chapter 11 gets court confirmation

By Jeff Pines

Washington, March 15 - MTS, Inc.'s pre-packaged Chapter 11 received court approval on Monday, the company said.

Under the confirmed plan, noteholders will get 85% of the reorganized company's equity and $30 million of new senior notes. The Solomon family, which founded MTS, will get 15% of the equity.

The plan has no effective date yet, but it should have one within a week, MTS spokeswoman Maya Pagoda said.

There were a few minor objections to the plan, but those were resolved before the hearing, she said.

MTS, which owns Tower Records, filed for Chapter 11 on Feb. 9 with the bankruptcy court for the District of Delaware.

In addition, when the company emerges, its $100 million debtor-in-possession financing will convert to a revolver.

The Chapter 11 case number is 04-10394.

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