Pittsburgh Corning Exits Bankruptcy After 16 Years
April 27 2016 - 9:29AM
Dow Jones News
By Patrick Fitzgerald
After more than 16 years under court protection, Pittsburgh
Corning Corp., the joint venture between PPG Industries Inc. and
Corning Inc., emerged from its asbestos-related bankruptcy
Wednesday.
The Pittsburgh Corning plan channels claims against the
company's non-bankrupt parents to a $3.5 billion trust that was set
up under the plan to absorb asbestos liabilities. The trust, one of
the country's largest, is being funded by PPG, Corning and their
insurers.
Pittsburgh Corning, a maker of glass-based insulation materials
used in construction and oil and gas pipelines, spent the first
five years in bankruptcy on protecting and preserving its
assets.
"When it became apparent that Pittsburgh Corning's time in
bankruptcy was going to be extended, our focus expanded to include
strategic actions designed to reinvent our business," said James R.
Kane, the company's chief executive.
Pittsburgh Corning is one of many large companies attempting to
use bankruptcy to survive an onslaught of claims for asbestos
damage. The bankruptcy code allows companies to set up trust funds
to pay claims, insulating their future operating funds from
potential liabilities.
The trust resolves all of the Pittsburgh Corning's asbestos
personal injury claims, including those filed in the future.
In 2002, PPG agreed to pay $2.7 billion to resolve all of its
asbestos-related personal-injury litigation through Pittsburgh
Corning's bankruptcy proceedings. About a year later, Corning
reached a deal to settle all asbestos claims against Corning and
Pittsburgh Corning.
In 2013, U.S. Bankruptcy Court Judge Judith Fitzgerald confirmed
Pittsburgh Corning's bankruptcy plan. Judge Fitzgerald had rejected
an earlier version of the plan because it improperly extended
protection from liability to the company's corporate parents.
Founded in 1937, Pittsburgh Corning made pipe insulation
containing asbestos from 1962 to 1972. In April 2000, the company
filed for chapter 11 bankruptcy protection, when it became apparent
that defending and settling an additional 235,000 claims would
exhaust its resources before they could be resolved.
Write to Patrick Fitzgerald at patrick.fitzgerald@wsj.com
(END) Dow Jones Newswires
April 27, 2016 09:14 ET (13:14 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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