KBC Seeks to Dismiss Exelco’s Chapter 11 Filing

KBC Bank, former owner of now-defunct Antwerp Diamond Bank, is seeking to have Exelco’s Chapter 11 filing dismissed, arguing the proceeding belongs in Belgium.

The case commenced Sept. 26 in Delaware federal court when Exelco North America filed for Chapter 11, along with related companies Exelco NV, FTK Worldwide MFG, and Ideal Diamond Trading USA.

In its motion to dismiss the case, the bank asserts the deliberation does not belong in U.S. court, noting that a legal proceeding is still ongoing in Belgium. It said that following fruitless negotiations, KBC filed a petition in September with the Commercial Court of Antwerp to recover money from Exelco.  By filing an action in Delaware, the bank asserts that Exelco is doing “naked forum shopping.”

However, a declaration filed by Exelco chief restructuring officer Kris Cuyvers says the company believes the United States offers them “a forum that will allow us to achieve our restructuring goals,” saying KBC’s goal is the company’s liquidation.

Cuyvers said that Exelco’s issues date back to 2015, when rough diamond sales began to increase while retailers tightened terms. In 2017, its De Beers sight was revoked due to “financial hardship,” furthering its woes. But he says Ideal Diamond Group “will provide a steady and reliable cash flow into the future.”

The company owes $14 million to KBC, $13 million to Standard Chartered Bank, and $22 million to the trade. Nondebtor entities owe Standard Chartered another $22 million.

 

JCK News Director

Comments are closed in this post.