Molycorp estimates show liquidation would result in unpaid debts
Published: Tuesday, 29 December 2015
Court documents have revealed that should the former rare earths producer be liquidated, more than 1bn in debt would go unpaid. While its plants to exit chapter 11 bankruptcy have been a point of contention on the basis that they give creditor Oaktree Capital too much power, Molycorp is arguing it would be more favourable for lenders.
Financial estimates from US-based Molycorp Inc. have
suggested it would be more beneficial for the company to exit
chapter 11 bankruptcy rather than being liquidated.
According to bankruptcy-court documents, liquidation would
value the company at $252m – nowhere near enough to
cover Molycorp’s $2bn in debt.