MatlinPatterson fund hearing on case conversion set for April 8

By Sarah Lizee

Olympia, Wash., Feb. 24 – A hearing on the potential conversion of MatlinPatterson Global Opportunities Partners II LP’s Chapter 11 bankruptcy case to Chapter 7 has been scheduled for April 8 by the U.S. Bankruptcy Court for the Southern District of New York.

As previously reported, foreign representative Vanio Cesar Pickler Aguiar asked the court to convert the case, saying the debtors’ negative cash flow is depleting the estate.

“The debtors are defunct and incapable of emerging as operating entities,” Aguilar said.

The foreign representative also claims the debtors have a conflict of interest in investigating their insider transactions completed in the run up to the filing for bankruptcy or in investigating the significant fees incurred in connection with the filing of the cases.

Aguilar also said that there are no relevant activities the debtors can take that a Chapter 7 trustee can’t undertake.

“The ongoing administrative costs of the estate would be much lessened by conversion,” Aguilar added.

MatlinPatterson is a New York-based distressed debt and credit opportunities fund. The company filed bankruptcy on July 6, 2021 under Chapter 11 case number 21-11255.

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