Some Salaried Retirees Request Panel In Kaiser Aluminum Ch 11 Case
Updated: Tuesday, March 26, 2002 04:03 PM ET
WASHINGTON (Dow Jones)--Some salaried retirees of Kaiser Aluminum Corp. (KLU, news, msgs) have asked a bankruptcy court to appoint an official committee to represent them in the company's Chapter 11 case.
In a recent filing with the U.S. Bankruptcy Court in Wilmington, Del., a group of five retirees said that Kaiser opeing unit Kaiser Aluminum & Chemical Corp. intends to shifratt an additional $10 million in annual medical-benefit costs to more than 4,500 retirees without any cost-sharing by active employees or hourly retirees represented by unions.
"In addition, the debtors have indicated that they may 'seek to modify' the retirees' benefits in the future," according to the retiree group, which includes a former senior vice president of Kaiser Aluminum and a former chairman and president of Kaiser Development Co.
The retiree group said the retiree committee would do its "best to protect the retiree benefits," which include medical, surgical and hospital-care and life insurance. The retiree group said the committee's scope wouldn't include pension benefits.
According to the retiree group, Bankruptcy Section 1114(d) provides for appointing a retiree committee when a debtor tries to modify or not pay for benefits that aren't protected by a collective-bargaining agreement. Such committees have been appointed in other large Chapter 11 cases, such as that of Polaroid Corp. (PRDCQ, news, msgs).
Objections to the request are due April 8. A hearing hasn't yet been scheduled, according to the court docket.
Counsel for Kaiser Aluminum couldn't be reached for immediate comment.
As reported, Kaiser Aluminum and certain affiliates filed for Chapter 11 on Feb. 12, listing assets of $3.3 billion and debts of $3.1 billion.
Kaiser Aluminum said it had faced significant near-term debt maturities during an unusually weak aluminum market and that it had become increasingly burdened by asbestos litigation and its growing obligations for retiree medical and pension costs.
-By Deborah Eckert, Dow Jones Newswires;