WILMINGTON, Del. (AFX) - An attempt to broker a deal between W.R. Grace & Co. and its asbestos creditors failed, bankruptcy lawyers said Monday.
David Bernick, lead bankruptcy lawyer for the specialty chemical company, said it had decided not to negotiate further when asbestos-claim lawyers offered nothing for shareholders.
W.R. Grace, of Columbia, Md., filed for Chapter 11 protection in 2001 in an effort to resolve liabilities stemming from products containing asbestos.
Earlier this year, U.S. Bankruptcy Judge Judith Fitzgerald appointed a mediator to attempt to settle differences between W.R. Grace and lawyers for people with asbestos-related diseases and property damage.
Lawyers for asbestos creditors also told the judge that the mediation with the company wasn't successful.
W.R. Grace wants to settle the claims of those with asbestos-related diseases and property damage without taking all the value out of the hands of its shareholders.
Lawyers for people with asbestos claims say the company is probably not worth enough to cover debts to creditors and still leave something for shareholders.
Bernick said that the negotiations with asbestos claimants could resume at some point in the future, but he added that the main priority for the company is to get an estimate of its liabilities.
Last week, W.R. Grace and some top-ranking executives pleaded not guilty for the second time to federal criminal charges that grew out of its mining operation in Libby, Mont.
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