Thursday, April 24, 2008
A plan to restructure $32-billion of
stalled asset-backed commercial
paper cleared a key hurdle yesterday
after an Ontario Superior Court
judge ruled that a noteholder vote
can go ahead on Friday as scheduled
despite complaints by some investors
that the plan is illegal.
In a brief decision, Justice Colin
Campbell said that the vote must
proceed despite objections by some
investors that the plan is unfair
"To postpone the vote would signal
the failure of the plan," which
would have "extremely serious
consequences," he said.
However Justice Campbell left the
door open to possible changes to the
workout in early May may when he
rules on the fairness of the plan.
About 1,800 retail investors are
widely expected to approve the
workout since they would get their
money back in full if it succeeds.
Because they are the largest
noteholder group, a positive outcome
of the vote is almost a certainty.