MTR Western is the biggest asset in the bankruptcy estate of Darren Berg, who's been charged by federal prosecutors with running a Ponzi scheme that cost investors more than $100 million.
All operations, including manufacturing, sales and warranty support, will continue to operate as usual during the reorganization, company officials said.
Ambac Assurance Corp. of Wisconsin and Wells Fargo Bank had argued that the monorail should not be allowed to proceed under Chapter 11, arguing that a filing under Chapter 9 reserved for government agencies was more appropriate.
Monorail officials said last month that they had three options: Negotiate an agreement with bondholders without filing for bankruptcy; file for bankruptcy with the bondholders’ blessing; or file without a new agreement in place.
Company will reduce debt obligations on its balance sheet from approximately $1.2 billion to approximately $400 million.
In conjunction with its emergence from Chapter 11, the company has obtained $230 million of exit financing and consummated its pre-negotiated plan.
Securing the contract with Winnipeg assembly plant workers is a key milestone, enabling MCI to continue its plan to successfully emerge from Chapter 11 Bankruptcy protection, which it plans on exiting in late March, according to the company.
MCI and its U.S. subsidiaries filed voluntary petitions for Chapter 11 on September 15, 2008 to implement a pre-negotiated restructuring plan.
Late last week, MCI was granted final approval to continue all customer programs and services without interruption, and will also continue to honor all standard limited warranties on its coaches.
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