BP (NYSE:BP) may stick their potential asset buyers with lawsuits, said lawyers. As the company continues its attempt to raise money to help pay legal claims that some are estimating could reach over $100 billion.
There are certain laws in place that could prohibit fraudulent transfers, allowing victims to sue a buyer to get money to pay claims. Which would leave the purchaser required to pay BP's obligations, if the company files for bankruptcy. Although there could be a change to federal bankruptcy laws, if approved could make a buyer wait for BP's approval from victims for the sale. The other option being to convince a judge that the company has sufficient assets to pay all legal claims in full.
New York bankruptcy lawyer, Martin Bienenstock of Dewey of Leboeuf LLP said, "Any purchaser will worry about fraudulent transfer and successor liability issues and perhaps request part of the purchase price be kept in escrow for such a contingency."
Showing posts with label Bankruptcy. Show all posts
Showing posts with label Bankruptcy. Show all posts
Friday, July 16, 2010
Friday, June 25, 2010
BP (NYSE:BP) Stock Price Reaches All Time Low
Due to concerns continuing to mount about BP's (NYSE:BP) future, there is added pressure on oil and gas stocks by the New York stock oil futures. These losses came after BP announced that it has to date spent $2.35 billion. This money has went to various things including the oil cleanup efforts, legal claims that have been paid, and grants to the states on the Gulf that have seen the biggest impact since the April 20th rig disaster.
The other thing that is causing renewed concern and placing pressure on BP stocks, is the pending development of a tropical storm. If this storm hits the Gulf of Mexico as predicted, it will cause possible large delays in the fuel containment efforts. Broker Nomura cut it projected BP price target from 593p to 465p.
Nomura said, "a heavy inversion of both credit yield and equity volatility suggests the market is concerned about a near term credit event around BP." BP stock fell to $26.96 a share losing another 6.1 percent. This beating their prior day low of $28.56, losing a total market value of almost 53 percent since April 20th.
"BP's market cap is eroding and its ability to finance itself in the capital market is impaired. It's anybodies guess what can happen but the fear of the market is that that liability could be so enormous that BP may have to seek bankruptcy protection," said Orr.
The other thing that is causing renewed concern and placing pressure on BP stocks, is the pending development of a tropical storm. If this storm hits the Gulf of Mexico as predicted, it will cause possible large delays in the fuel containment efforts. Broker Nomura cut it projected BP price target from 593p to 465p.
Nomura said, "a heavy inversion of both credit yield and equity volatility suggests the market is concerned about a near term credit event around BP." BP stock fell to $26.96 a share losing another 6.1 percent. This beating their prior day low of $28.56, losing a total market value of almost 53 percent since April 20th.
"BP's market cap is eroding and its ability to finance itself in the capital market is impaired. It's anybodies guess what can happen but the fear of the market is that that liability could be so enormous that BP may have to seek bankruptcy protection," said Orr.
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