Takefuji: Court rejected bondholder, creditor groups' competing plans

By Caroline Salls

Pittsburgh, July 26 - Takefuji Corp. said the Tokyo District Court has rejected two competing liquidation plan proposals submitted by some of the company's bondholders and some of its creditors, according to a news release.

Specifically, Takefuji said the bondholders filed a petition for approval to submit a plan that called for the discontinuance of the company's whole business. That request was denied on July 8.

According to a separate release, the court rejected the bondholders' proposal because they did not prove that it would be difficult to submit a plan to continue the business and that the liquidation distribution rate based on the book value of cash loan receivables was inappropriate.

Meanwhile, a group of creditors with overpaid interest filed a reorganization plan, but the court issued an order on July 22 not to put that plan to a vote.

Takefuji said the creditors' plan would have provided a 16.3% repayment rate but was based on the assumption that a ¥200 billion tax refund paid to a member of the company's founding family would be a repayment source.

The company said the court ruled that there were no justifiable grounds to consider the tax refund as a form of repayment or that company plan sponsor A&P Financial Co., Ltd. would cooperate as the sponsor of the creditors' plan, which the creditors also assumed.

As a result, Takefuji said its reorganization plan is the only one being put to creditor vote.

Takefuji is a Tokyo-based consumer finance company.

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