Detroit bankruptcy trial on hold as city tries to repay creditor
Michigan's largest city is negotiating with a bond issuer on paring down its debt and may be close to a settlement.
Michigan's largest city is negotiating with a bond issuer on paring down its debt and may be close to a settlement.
A judge has suspended聽Detroit's聽bankruptcy trial until Monday to give the city more time to work out details of a settlement with a major creditor.
The time-out Wednesday also gives the city an opportunity to reach other settlements.
The city reached a deal Tuesday with Syncora, a bond insurer that stood to lose $400 million under聽Detroit's聽plan to get out of bankruptcy.聽Detroit聽would extend Syncora's lease on a tunnel between the US and Canada and also get a long-term lease on a parking garage.
The financier would get 26 percent of what it's owed.
Judge Steven Rhodes is holding a trial to determine if聽Detroit's聽bankruptcy exit plan is fair and feasible. Thousands of retirees would see a 4.5 percent pension cut.
Earlier this summer, the Monitor reported that Syncora and another bond issuer were not happy with a deal the city cut with pensioners, to the detriment of the two companies.