1.Holders seek end to Solutia's Chapter 11
2.BIOTECH: No class action against Monsanto
GM WATCH COMMENT: Solutia Inc. was spunoff from Monsanto Corporation as a way of Monsanto divesting itself of hundreds of millions of dollars in environmental cleanup costs and other liabilities for its past actions - liabilities that eventually forced Solutia to seek Chapter 11 bankruptcy protection.
According to a spokesman for Solutia, "(Monsanto) sort of cherry-picked what they wanted and threw in all kinds of cats and dogs as part of a going-away present," including $1 billion in debt and environmental and litigation costs accrued by Monsanto (not to mention Pharmacia, which at one time owned Monsanto).
http://www.glassonweb.com/news/index/2064/
As well as the consequences of the legal action described below (item 1) for Monsanto, the company could still face additional liabilities that have yet to be quantified and which make up a lion's share of the $1 billion in obligations that drove Solutia into bankruptcy. Those include the cost of dealing with hazardous polychlorinated biphenyls, or PCBs, that spread from former Monsanto plants into the communities of Sauget as well as Anniston, Alabama.
http://www.lobbywatch.org/archive2.asp?arcid=4745
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1.Holders seek end to Solutia's Chapter 11 Dow Jones, November 15 2006 http://www.belleville.com/mld/belleville/news/state/16016106.htm
Bondholders of Solutia Inc. are asking a bankruptcy judge to end the company's control of its bankruptcy case and allow them to negotiate their own plan with the company's former parent.
The bondholders, a group of about 20 hedge funds who call themselves the ad hoc committee of Solutia noteholders, argue that the chemical company's proposed Chapter 11 plan offers an "exceptionally generous" settlement to former parent Monsanto Co. at the bondholders' expense.
A hearing on the company's request to retain sole control of its Chapter 11 case is scheduled for Thursday in bankruptcy court.
"The plan process led by the debtors has failed," the bondholders said in papers filed Friday in U.S. Bankruptcy Court in Manhattan. Saying a new process needs to take the place of Solutia's failed strategy, the bondholders are "prepared today to do what the debtors have failed to do: bring about 'hard bargaining' among the parties and lead the way to a consensual plan."
Solutia filed for Chapter 11 protection from creditors in December 2003. The company listed total assets of $2.85 billion and debts of $3.22 billion.
St. Louis-based Solutia has proposed a Chapter 11 reorganization plan that has the backing of Monsanto, also in St. Louis and its successor Pharmacia Corp., which merged with Monsanto in 2000.
"Solutia does not agree with the bondholders' motion," said company spokesman Dan Jenkins. "And we will address it formally as part of the bankruptcy process."
The bondholders want to negotiate the terms of Solutia's reorganization directly with Monsanto and Pharmacia, now a unit of New York-based Pfizer Inc. The bondholders believe that Monsanto should shoulder more of Solutia's pension environmental liabilities.
At the center of the dispute is a change in the bondholders' claim against Solutia of more than $450 million from secured to unsecured status.
Under Solutia's plan, secured claims would be paid in full. But unsecured creditors, including bondholders, are expected to recover between 48 cents and 56 cents on the dollar.
Solutia's proposed plan calls for former parent Monsanto to backstop a $250 million rights offering and to fund costs of environmental cleanup and retiree benefits.
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2.BIOTECH: No class action against Monsanto
St Louis Today, November 15 2006
http://www.stltoday.com/stltoday/business/stories.nsf/0/C922912074183DCC86257227001040E8?OpenDocument
A seed company and a group of Midwestern farmers who sued Creve Coeur-based Monsanto Co. for allegedly monopolizing the biotech corn seed market were denied class-action status Monday in federal court in Wilmington, Del.
The plaintiffs, led by American Seed Co. of Spring Grove, Pa., alleged that Monsanto used financial incentives and bundled rebate programs to drive competitors out of business, allowing Monsanto to inflate prices.
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