Detroit bankruptcy trial on hold after major deal
DETROIT (AP) — A judge has suspended Detroit's bankruptcy trial until Monday to give the city more time to work out details of a settlement with a major creditor.
The time-out Wednesday also gives the city an opportunity to reach other settlements.
The city reached a deal Tuesday with Syncora, a bond insurer that stood to lose $400 million under Detroit's plan to get out of bankruptcy. Detroit would extend Syncora's lease on a tunnel between the U.S. and Canada and also get a long-term lease on a parking garage.
The financier would get 26 percent of what it's owed.
Judge Steven Rhodes is holding a trial to determine if Detroit's bankruptcy exit plan is fair and feasible. Thousands of retirees would see a 4.5 percent pension cut.