Detroit Bankruptcy negotiations gain urgency

The Detroit News reports:

Closed-door negotiations in Detroit’s bankruptcy have intensified this week as the city and its numerous creditors try to strikea deal to restructure $18 billion in debt.

City and creditor attorneys have been meeting in New York City since Monday trying to reach a consensual debt-cutting deal by week’s end before the spotlight turns to Detroit’s North American International Auto Show, which starts Monday, sources close to the negotiations told The Detroit News.

While court-appointed mediators are pushing the opposing parties to reach a consensual deal, legal experts say arbitrary deadlines are bound to be broken in the free-wheeling process of a municipal bankruptcy bogged down by the competing interests of retirees, bondholders, banks, insurers and supporters of the Detroit Institute of Arts.

“There’s no doubt that people would like to get the plan (of adjustment) moving, but it’s not going to be settled that fast,” said Bill Brandt, a government restructuring consultant in Chicagonot involved in the case. “There’s a lot of fight left to be had on this.”