Court sets new criteria to determine Mirant's value

<p>A Texas federal bankruptcy judge has told Mirant Corp. to utilize different criteria than the methods it used to calculate its value in its Chapter 11 filing.</p><p>Atlanta-based Mirant listed its value at about $9 billion, compared to the shareholder group's estimate of at least $13 billion.</p><p>Shareholders applauded Thursday's ruling by Judge Michael Lynn at the U.S. Bankruptcy Court in Fort Worth, Texas. Shareholders had been concerned that stock issued before the Chapter 11 filing would be worthless under Mirant's plan.</p><p>The new criteria ordered by Lynn includes an extra $450 million for possible litigation settlements. Lynn also called for other figures to be updated and reorganized.</p><p>The shareholders say the changes are necessary.</p><p>"Shareholder rights group is pleased that the court took the time to consider the evidence we presented," said Paul Syiek, an Atlanta spokesman for the shareholders.</p><p>"It has been our position all along that there is substantial evidence that Mirant is understating the company's value in order to deny shareholders their rightful recovery. We believe that the modifications ordered by the court will prove that point."</p><p>Lynn said if the updated value is more than $10.7 billion, equity holders would be empowered to have a seat at the Chapter 11 plan bargaining table with other creditors under the assumption they would be due some recovery.</p><p>"We will of course make the modifications required by the judge as thoroughly, impartially and rapidly as possible," Mirant spokesman David Thompson said Friday. "Throughout the Chapter 11 process we have upheld our fiduciary responsibility to serve all parties equally and fairly and we will continue to do so."</p><p>Added Thompson: "However, we are unable at this point to determine how long this process will take or when we will emerge from Chapter 11."</p><p>An attorney for the shareholders, Ed Weisfelner, said he expects the company's value will come in at more than $11 billion.</p><p>If the recalculated value of the company is less than $10.7 billion, the shareholders will have a more limited role.</p><p>"It is impossible and inappropriate for us or any other party to speculate on final value of the company until the modifications are performed and the judge makes his final ruling," Thompson said.</p><p>Weisfelner did not immediately return a call Friday.</p>