U.S. Trustee seeks to convert Vitro case to Chapter 7 bankruptcy

By Jim Witters

Wilmington, Del., Dec. 1 - The U.S. Trustee is seeking to convert the Chapter 11 bankruptcy case of Vitro SAB de CV to Chapter 7, according to documents filed Thursday with the U.S. Bankruptcy Court for the Northern District of Texas.

Trustee William T. Neary argued that Vitro continues to dilute the value of its estate with no reasonable likelihood of reorganization.

"On June 9, 2011, the court approved the sale of substantially all the debtors' assets to American Glass Enterprises, LLC. The debtors' transaction with American Glass closed on June 17, 2011," Neary said in his motion.

In October, the debtors reported negative cash flow of $1.1 million and post-petition liabilities of $5.1 million, the motion states.

"The debtor has already paid over $7.5 million in professional fees since the orders for relief were entered. As of Oct. 31, the debtor reported $557,499 in unpaid professional fees," according to the motion.

"The debtors no longer generate any revenue because they have sold substantially all of their assets to American Glass. Without revenue, the debtors cannot reorganize," Neary wrote. "These cases could be more efficiently liquidated by a Chapter 7 trustee."

A hearing on the conversion motion is scheduled for 11 a.m. ET on Dec. 29.

Vitro is a Nuevo Leon, Mexico-based glass manufacturer.

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