Omega Navigation creditors: Chapter 11 plan not proposed in good faith

By Caroline Salls

Pittsburgh, March 1 - Omega Navigation Enterprises, Inc.'s official committee of unsecured creditors objected to the disclosure statement for the company's plan of liquidation, saying the plan was not proposed in good faith, according to a Friday filing with the U.S. Bankruptcy Court for the Southern District of Texas.

"The principle purpose of the plan is not to provide distributions to creditors, but instead to grant impermissible discharges and releases to debtors and their management, insiders, affiliates and professionals," the committee said.

The committee said the plan fails to preserve beneficial claims and causes of action against the debtors, management, insiders, affiliates and professionals.

In addition, the creditor group said the proposed plan cannot be confirmed because it does not pay all administrative expenses in full and may not provide any distribution to a non-insider, impaired creditor class.

Omega Navigation is an Athens, Greece-based provider of marine transportation services. The company filed for bankruptcy on July 8, 2011 under Chapter 11 case number 11-35926.

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