DVI creditors object to disclosure statement

By Jeff Pines

Washington, Oct. 6 - Three of DVI Inc.'s creditors objected to the medical equipment finance company's disclosure statement because it lacks adequate information.

The three creditors filed objections with the U.S. Bankruptcy Court for the District of Delaware Tuesday and Wednesday.

DEG, or Deutsche Investitions- und Entwicklungsgesellschaft mbH, Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden NV, or FMO, and International Finance Corp. are creditors of DVI's solvent MSF Holding Ltd.

MSF Holding and its subsidiaries provide financing for medical equipment in Latin America.

The three creditors have liens on leases and loan receivables, and MSF's assets cannot be sold without the three creditors' consent. The proceeds from the sale of the leases and receivables have to go toward paying off the loans with DEG, FMO and IFC, they said.

The disclosure statement does not mention this, they said.

DEG, FMO and IFC are concerned that by not mentioning MSF's obligations, DVI may be considering breaching the agreements.

DVI filed for bankruptcy on Aug. 25, 2003. Its Chapter 11 case number is 03-12656.

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