Sea Containers disclosure statement expected to gain approval Monday; pension scheme settlement upheld

By Jennifer Lanning Drey

Portland, Ore., Sept. 19 - Sea Containers Ltd. expects to gain approval from the U.S. Bankruptcy Court for the District of Delaware for the disclosure statement for its plan of reorganization following a Monday teleconference with the court, according to an attorney familiar with the case.

The court has tentatively scheduled the plan confirmation hearing for Nov. 24.

"Barring any unforeseen circumstances, I don't think anybody expects any issues on Monday," said the attorney.

As previously reported, treatment of creditors includes:

• Holders of other secured claims will recover 100% either in cash or through a full return of the collateral securing the claim;

• Holders of other priority claims will recover 100% in cash;

• Holders of other unsecured claims and pension schemes claims will recover 47% to 61% through an unsecured claim distribution;

• Sea Containers Caribbean Inc. interests will be reinstated; and

• Holders of Sea Containers Ltd. common stock interests will receive no distribution under the plan.

Pension settlement upheld

Also on Friday, an objection to Sea Containers' settlement with its 1983 and 1990 pension schemes was overruled by the court, according to a Friday filing.

The ruling affirmed that the 1983 and 1990 pension schemes will have a single $194 general unsecured claim against the company under the settlement.

According to the filing, the company's official committee of unsecured creditors had objected to the settlement on the grounds that the methodology and calculations used to determine the amount were flawed and had resulted in excessive recoveries for the schemes at the detriment of the creditors.

According to the settlement motion, $153.8 million of the $194 general unsecured claim will be allocated to the 1983 pension scheme, and $40.2 million will be allocated to the 1990 pension scheme.

The company will also pay $5 million to the pension schemes under the settlement for administrative expenses.

Sea Containers, a Hamilton, Bermuda-based provider of passenger and freight transport and marine container leasing, filed for bankruptcy on Oct. 15, 2006. Its Chapter 11 case number is 06-11156.

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