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BearingPoint Files for Chapter 11 Bankruptcy

McLean-based consultancy BearingPoint filed for bankruptcy protection under Chapter 11, the company announced today, saying it plans to continue business uninterrupted while reorganizing, The Post's Alejandro Lazo reports.

"The filing was made with a 'pre-arranged' restructuring plan with the support of the Company's senior secured lenders. As a result, the Company expects that it will complete its restructuring process on an accelerated basis," the company said in a release.

The plan provides that a 2007 $500 million senior secured credit facility will be replaced with a new secured, senior credit facility under the following conditions:

- A term loan in the amount of $272 million plus accrued interest and a synthetic letter of credit facility in the amount of up to $130 million.

-- The issuance of new preferred stock.

-- The unsecured debt will be exchanged for different classes of common stock.

-- All existing equity in the company will be canceled for no consideration.

The Post's Mike Rosenwald wrote about the company's troubles in January. You can read his story here.

-- Frank Ahrens
The Ticker is Twittering!

By Frank Ahrens  |  February 18, 2009; 10:06 AM ET
Categories:  The Ticker  | Tags: BearingPoint, bankruptcy  
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Comments

The most incompetent people work for that company. I hope Bearingpoint files for chapter 7, and the all employees can work for McDs where they belong.

Posted by: August30 | February 18, 2009 10:36 AM | Report abuse

Seems like a logical move. The company should emerge much stronger afterward, though most likely in a different form.

Posted by: Section315 | February 18, 2009 10:50 AM | Report abuse

Makes me wonder if Bearing Point doesn't need to hire a consulting firm the help them manage their money better. Bwahahahah!

Posted by: lobo404 | February 18, 2009 12:26 PM | Report abuse

"a synthetic letter of credit facility"

WTF is a synthetic letter of credit facility? If science news can't include math equations and tech news can't include electronic diagrams then econ news can't contain statements like "a synthetic letter of credit facility".

Posted by: martiniano | February 18, 2009 12:36 PM | Report abuse

Good for Bearing Point. During the last recession I had been laid off by an Internet startup that did not receive a 2nd round of investment capital. I did a telephone interview with Bearing Point, that was ended very shortly after they discovered I was currently unemployed.

I have been employed ever since then by a different firm and do not face a layoff this recession (thank goodness!). Glad to hear Bearing Point is doing so well. In my mind they deserve Chapter 7.

Posted by: rb-freedom-for-all | February 18, 2009 12:42 PM | Report abuse

They will emerge in a different form.

Its called a 'Temp Agency' and they charge slightly less to bring warm bodies to large IT projects. The results are the same, cost overruns and late projects. At least the overruns are smaller at lower rates.

Posted by: mikey999 | February 18, 2009 1:09 PM | Report abuse

"The most incompetent people work for that company. I hope Bearingpoint files for chapter 7, and the all employees can work for McDs where they belong." Clearly spoken by a true pundit. Your astute and well-informed opinions have added a lot of value to this forum. Really. Keep 'em coming.

Posted by: kpenote | February 18, 2009 1:22 PM | Report abuse

I have worked with numerous contractors in my years with the Federal government and have found that the Bearing Point employees are top-notch. Sounds like the only commenters that think they are incompetent are the ones who couldn't get jobs with them!

Posted by: fairandbalanced3 | February 18, 2009 2:02 PM | Report abuse

HA! BP is no different than any other consulting company. These companies all have a one track mind: billability. If you don’t manage them like white on rice, they will run you, your project and your enterprise off the cliff. Looks like they need to bring in Accenture or IBM-BCS - maybe they can run them off the cliff in into Chapter 7.

Posted by: 6664U | February 18, 2009 2:22 PM | Report abuse

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