Monsanto/solutia retirees
On
Tuesday, June 7, both Monsanto and Solutia issued press releases stating that
they, along with the Official Committee of Unsecured Creditors, had reached an
"agreement-in-principle" regarding Solutia's reorganization.
These press releases can be read at Monsanto.com
and Solutia.com. Of importance to retirees is that Monsanto
will underwrite a $250 million equity infusion into the new reorganized Solutia
to support retiree benefits and certain environmental liabilities. $150
million of that amount is specifically to satisfy, in part, the retiree
medical, disability and life insurance benefits of the pre-spin retirees, those
who receive these benefits from Solutia but retired from Monsanto prior to the
spin-off.
It does not address the benefits of the post-spin retirees which is still to be
determined.
At the time of these releases, two members of the Retirees Bankruptcy Committee
were preparing to go to New York at the request of Solutia's legal firm, Kirkland
& Ellis, to meet on June 9 and receive information regarding the
reorganization and any proposed modifications to retiree benefits that might
result. Kirkland & Ellis cancelled the meeting following the issue of
the press releases, claiming conflicts for their person or persons involved.
At the time of this writing (June 8) the Retirees Bankruptcy Committee
has no information other than the press releases regarding Solutia's
reorganization. I expect the meeting with Kirkland & Ellis to be
rescheduled and we will receive information related to retiree benefits at that
time.
Keep in mind that an "agreement-in-principle" has been reached, not a
definitive agreement or contract; the Bankruptcy Court first has to approve
this agreement before any subsequent details can be worked out. Then,
when a definitive agreement is agreed upon, it will also have to be approved by
the court. There is still a lot to be determined.