Dan River seeks exclusivity extension after settlement talks fail

By Caroline Salls

Pittsburgh, Nov. 6 - Dan River Holdings, LLC requested an extension to its exclusive periods to file a plan of reorganization and solicit votes on the plan, according to a Thursday filing with the U.S. Bankruptcy Court for the District of Delaware.

Specifically, the company wants to extend its exclusive plan-filing period to Jan. 17 from Nov. 18 and the solicitation period to March 18 from Dec. 18.

Since shortly after its bankruptcy filing, Dan River said it has been in a lien dispute with GHCL, Inc. and GHCL, International, Inc.

The company said the parties have not been able to resolve the dispute.

Dan River said it started to draft a plan to resolve the cases, and the initial draft incorporated an offer from GHCL to purchase the bulk of the company's assets.

According to the filing, the sale offer became the basis for settlement term sheets. However, GHCL and Dan River's official committee of unsecured creditors asked the company to stop drafting a plan pending resolution of settlement discussions.

After a series of discussions, the committee and GHCL informed Dan River that there is little realistic expectation that a resolution will be reached.

As a result, Dan River said it needs more time to develop a plan of liquidation.

Dan River, a Danville, Va.-based textile company, filed for bankruptcy on April 20, 2008. Its Chapter 11 case number is 08-10726.

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