Sungard disclosure statement conditionally approved at hearing

Chicago, Sept. 7 – Sungard AS’ disclosure statement has been conditionally approved at the hearing held on Wednesday, according to an order filed with the U.S. Bankruptcy Court for the Southern District of Texas.

As previously reported, on Aug. 31 the court approved the sale of Sungard’s colocation services, network services and workplace services assets (the Bravo business) to 365 Data Centers. Sungard is seeking approval of a sale of its North American cloud and managed services and mainframe as a service assets (the CMS business) to 11-11 Systems, Inc. Sungard is also in discussions to sell its data recovery business and related assets (the Eagle business). Should those last assets not be sold, Sungard intends to reorganize around those assets and any other remaining assets. However, if the data recovery business is sold, it is not anticipated that the proceeds would be sufficient to satisfy the first-lien credit agreement claims in full.

The amended disclosure statement and plan include a global settlement with required consenting stakeholders who have agreed to fund the wind down amount.

Currently, under the amended plan:

• Holders of other secured claims will receive payment in full in cash, delivery of the collateral securing their claims, reinstatement of their claims, or other treatment leaving their claims unimpaired;

• Holders of other priority claims have been satisfied;

• Holders of first-lien credit agreement claims will receive a currently undetermined amount and are considered impaired;

• Holders of second-lien credit claims will receive nothing, and are deemed to reject the plan;

• Holders of non-extending second-lien credit agreement claims will receive nothing, and are deemed to reject the plan;

• General unsecured claims will not be honored, with holders deemed to reject the plan;

• Section 510(b) claims will receive nothing, with holders deemed to reject the plan;

• Intercompany claims and interests will either be honored or fully rejected, with individual claimants either presumed to accept or deemed to reject the plan accordingly;

• Existing equity will be canceled.

Sungard intends to file a plan supplement by Sept. 19.

Ballots would need to be received by Sept. 26. The only voting class is the first-lien credit agreement claims.

The confirmation hearing is planned for Oct. 3.

Sungard is a Wayne, Pa.-based provider of disaster recovery services, managed IT services, information availability consulting services and business continuity management software. The company filed bankruptcy on April 11 under Chapter 11 case number 22-90018.

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