Novation Cos. Inc.and certain of its subsidiaries have filed voluntary petitions for Chapter 11 businessreorganization in the U.S. Bankruptcy Court for the District of Maryland, Baltimoredivision.
Novation said it has significant liquid assets and net operatinglosses that it expects to preserve during the Chapter 11 process.
The company has engaged a financial adviser to review financialand strategic alternatives. The company and the adviser are working to acquire aprofitable operating business in order to maximize its return to all creditors andstakeholders. The company will seek to restructure its obligations or have its obligations,primarily those under its senior unsecured notes, reinstated.
Novation also intends to vigorously defend and seek to determinethe claims asserted in existing lawsuits for which the company and its units believethey have meritorious defenses.
Novation and its board are being advised by Oberon SecuritiesLLC, Olshan Frome Wolosky LLP and Shapiro Sher Guinot & Sandler PA.