W.R. Grace profits soar amid suffering

30 Oct 2008 by Wendi Lewis under Legal, News

W.R. Grace & Co. announced in mid-September that it had filed a Plan of Reorganization for the company with the U.S. Bankruptcy Court in Delaware. According to Grace Chairman, President and CEO Fred Festa, the filing was a step toward resolving the company’s -related liabilities and exiting its Chapter 11 bankruptcy status. A hearing on the company’s Disclosure Statement was set to begin this week.

As we have posted on this site many times before, W.R. Grace operated a vermiculite mine and processing plant in and near , , from 1963 to 1990. The vermiculite was contaminated with high levels of , which affected the health of mine workers and just about everyone who lived in the town. Gravel and other scrap rock from the mine was scattered throughout the town of , used in construction of a running track at the school, lining flowerbeds, and underfoot on ballfields.

Hundreds of residents have died of and other -related illnesses as a result of their widespread exposure to the materials, and even more are sick with disease. In March, Grace agreed to pay $250 million toward government cleanup efforts in the town of . It is estimated that the Environmental Protection Agency has spent at least $168 million so far in removing -contaminated soils and other materials from the area.

Reaching beyond , which has been basically killed by , the vermiculite insulation that was manufactured by Grace is still a danger in thousands of homes, where it was used for years. Grace is currently accepting claims from homeowners who have the company’s Zonolite Attic Insulation (ZAI) in their homes, for reimbursement of abatement costs and other economic loss and property devaluation related to the presence of the -laden material. This action, which centers exclusively on property-related damages, doesn’t even touch the potential health hazard of having the substance in one’s home.*

While Grace sorts out its bankruptcy issues, the Baltimore Business Journal reported on Oct. 23 that the company has seen record profits in 2008, experiencing nearly 50 percent growth in its third-quarter earnings. The Journal reports the Columbia-based Grace (NYSE: GRA) enjoyed a 14 percent increase in sales since last year, with revenues topping $800 million. The report says,  “Grace’s pre-tax income from core operations, which factors out costs related to the company’s Chapter 11 bankruptcy, rose 6 percent to $82 million.”

The story quotes Grace Chief Financial Officer Hudson La Force as saying, “What’s really important is the condition of the financial markets in the middle of next year. We’re very focused on making sure when the time comes to make our exit, we have the financing in place to do that.”

Documents outlining the company’s Financial Reorganization Plan are available on the Grace web site at www.grace.com.

*PLEASE NOTE: TO LEARN MORE ABOUT FILING A ZAI CLAIM, PLEASE VISIT THE GRACE BANKRUPTCY CLAIMS INFORMATION SITE at www.graceclaims.com to download the forms necessary to file your claim. Deadline to file is OCTOBER 31, 2008.

  • Bethany K Ford

    nice article! nice site. you're in my rss feed now ;-)
    keep it up

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