Powell Goldstein partner Penn Nicholson is representing a group of hedge funds in its attempt to force an Alpharetta pharmaceutical development company into bankruptcy.
Five hedge funds on Monday filed an involuntary petition for Chapter 7 bankruptcy against AtheroGenics Inc. of Alpharetta. The filing came about two weeks after AtheroGenics announced that it would not repay its 4.5% Convertible Notes that were due on Sept. 2. AtheroGenics said it wasn’t repaying the notes because it “has been attempting to restructure its 2008 Notes prior to their maturity, but was unable to agree on a restructuring on terms acceptable to the Company and the holders of the 2008 Notes.” AtheroGenics has also hired Morgan Stanley to explore alternatives.
The involuntary petition was filed in U.S. Bankruptcy Court for the Northern District of Georgia. PoGo’s Nicholson declined to comment on the filing.
The hedge funds that Nicholson is advising on the involuntary petition are: AQR Absolute Return Master Account and CNH CA Master Account, both managed by AQR Capital Management LLC of Greenwich, Conn.; Tamalpais Global Partner Master Fund, managed by Tamalpais Asset Management of Sausalito, Calif.; Tang Capital Partners LP of San Diego; and Zazove High Yield Convertible Securities Fund, managed by Zazove Associates LLC of Northbrook, Ill.
The five hedge funds “hold approximately $20.4 million of the Company’s 41/2% Convertible Notes due 2008,” according to an AtheroGenics regulatory filing.
AtheroGenics, as of Wednesday morning, had not yet responded in bankruptcy court. In a Tuesday regulatory filing, AtheroGenics said it “is reviewing the involuntary bankruptcy petition filed by the 2008 Noteholders and is evaluating its alternatives.” AtheroGenics’ general counsel is Joseph M. Gaynor Jr., a former Powell Goldstein associate.