Harvard endowment wants to take over bankrupt PALCO
By Dow Jones/AP
The Eureka Reporter
May 1, 2008
WASHINGTON — Harvard University’s endowment said Thursday it’s interested in buying more than 200,000 acres of timberlands in California as part of a plan to take over logging company Pacific Lumber Co. and bring it out of bankruptcy.
An attorney for the university endowment, the country’s largest, said it’s ready to offer a bankruptcy plan for Pacific Lumber. He said the offer would top the price offered by hedge fund Marathon Asset Management, although the plan would otherwise be similar to Marathon’s.
“Harvard is a serious institution. It has $5 billion invested in forestry right now,” Harvard lawyer Steven Hoort told Judge Richard Schmidt of the U.S. Bankruptcy Court in Corpus Christi, Texas.
The announcement comes as Marathon said it will offer bondholders of a Pacific Lumber subsidiary $530 million in cash in an effort to persuade the bondholders to drop their objections to Marathon’s plan. The cash offer would replace an earlier offer to pay bondholders $175 million in cash and $325 in new notes.
Bill Greendyke, an attorney representing bondholders of Scotia Pacific Co., the Pacific Lumber subsidiary that owns more than 200,000 acres of timberlands, told Schmidt he wants to see Marathon’s offer in writing. Schmidt is overseeing hearings to confirm a bankruptcy-exit plan for Pacific Lumber.
Marathon, Pacific Lumber’s bankruptcy lender, has teamed up with rival California logging company Mendocino Redwood Co. to take Pacific Lumber out of bankruptcy and repay creditors. They have offered to pump new money into the business and take over its operations. The plan has wide support from federal and California agencies.Posted in PALCO | Tagged HRC, MRC |