(DOWNLOAD) "Mellon Bank, N.A. v. Metro Communications, Inc." by United States Court of Appeals for the Third Circuit # eBook PDF Kindle ePub Free
eBook details
- Title: Mellon Bank, N.A. v. Metro Communications, Inc.
- Author : United States Court of Appeals for the Third Circuit
- Release Date : January 25, 1991
- Genre: Law,Books,Professional & Technical,
- Pages : * pages
- Size : 84 KB
Description
This appeal, arising in the context of a failed leveraged buyout, had its roots in the congenial climate of mergers and acquisitions that beguiled corporate America during the decade of the nineteen-eighties. The appeal raises important questions regarding a bankruptcy trustees avoidance powers under 11 U.S.C. 547(b) and 548(a)(2) of the bankruptcy code. The debtor is Metro Communications (Metro), the corporation acquired in the leveraged buyout. Mellon Bank, N.A. (Mellon or Bank) financed the acquisition; Mellon lent the acquiror 1.85 million dollars to purchase all of the capital stock of the target corporation, Metro. Metro guaranteed and secured the acquisition loan with substantially all of its assets. Simultaneously with the leveraged buyout, Mellon extended a 2.3 million dollar credit line to Metro. At a later date, Mellon extended another 2.25 million dollars to Metro in the form of letters of credit. These loans were also collateralized by the security interest in substantially all of Metros assets. Within a year of the leveraged buyout, Metro filed a bankruptcy petition under chapter 11.