Solutia seeks extension to exclusivity, creditors lose bid to disband equity holders' committee

By Jeff Pines

Washington, June 18 - Solutia Inc. wants an extension to its exclusive right to file a plan of reorganization and solicit votes.

In a filing Thursday with the U.S. Bankruptcy Court for the Southern District of New York, Solutia asked the court to extend the period it can exclusively file a reorganization plan by 90 days to Oct. 12 and to exclusively solicit votes until Dec. 11.

Its current right to exclusively submit a plan ends July 14 and its current right to exclusively solicit votes ends Sept. 12.

Although the St. Louis-based chemical company has made a lot of progress since it filed for bankruptcy, Solutia said it needs more time to refine and implement its business plan, identify and quantify its potential liabilities, evaluate the potential for asset sales, continue working to stabilize its pension plans and work toward a valuation of its domestic and foreign businesses.

Solutia noted its case is large and complex with nearly 90,000 creditors and more than $3 billion in liabilities. In addition, it has made progress with its creditors and said it is paying its bills as they come due.

In a related matter, Solutia's official committee of unsecured creditors failed in its effort to disband the official equity holders' committee. Both the U.S. trustee and the Securities and Exchange Commission opposed the move.

The ruling came in a Thursday filing with the U.S. Bankruptcy Court for the Southern District of New York.

Solutia filed for bankruptcy on Dec. 17, 2003. Its Chapter 11 case number is 03-17949.

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