WL Homes Chapter 11 case converted to Chapter 7 for liquidation

By Jennifer Lanning Drey

Portland, Ore., June 5 - WL Homes, LLC's Chapter 11 bankruptcy case was converted to Chapter 7 for liquidation effective June 5, according to a Friday filing with the U.S. Bankruptcy Court for the District of Delaware.

As previously reported, the company's official committee of unsecured creditors asked that the case be converted on the grounds that no tangible recovery was being offered for non-insider unsecured creditors and there was no hope of a plan of reorganization being confirmed in the case.

The creditors said the reorganization was solely for the benefit of pre-petition lender and corporate parent Emaar America Corp.

WL Homes had objected to the conversion motion, saying conversion would eliminate the going-concern value differential offered by a revised Emaar proposal.

WL Homes, an Irvine, Calif.-based homebuilder, filed for bankruptcy on Feb. 19. Its Chapter 11 case number is 09-10571.

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