Halliburton Co. inched closer to settling all asbestos liabilities Monday with completion of hearings in Pittsburgh to confirm the pre-negotiated bankruptcy for subsidiary DII Industries.
The company expects U.S. Bankruptcy Judge Judith Fitzgerald to rule on confirmation by late summer 2004, Halliburton spokeswoman Wendy Hall said. Then the company can move closer to paying out a $4.17 billion in cash and stock to settle 400,000 asbestos and 21,000 silica claims as announced in December 2002.
Halliburton also said that DII Industries has reached a non-binding agreement in principle with leaders of the London Market insurance companies that, if implemented, would settle outstanding insurance disputes related to the settlement. In addition, the Houston-based oil services conglomerate expects to enter into a similar non-binding agreement with solvent domestic insurance carriers.
If implemented, the potential insurance settlements announced Monday along with a settlement with Equitas announced in January would result in the receipt of an aggregate of about $1.6 billion in cash for all of DII Industries’ insurance receivables, Halliburton said. Halliburton intends to pay $2.775 billion of the total settlement in cash.
“These insurance settlements, if consummated, will resolve disputes between us and our carriers, forestall further appeals, and allow the bankruptcy proceedings to be completed expeditiously,” said Dave Lesar, Halliburton’s chairman, president and chief executive.
In February, Fitzgerald dismissed all claims by insurance companies in Halliburton’s asbestos settlement case, saying they had no standing to challenge the agreement. She said Monday she intends to issue a final order denying standing to insurance carriers’ objections to DII Industries’ reorganization plan.
Halliburton, once run by Vice President Dick Cheney, inherited most of the claims five years ago when the conglomerate, under Cheney’s leadership, acquired Dresser Industries Inc. for $7.7 billion. Cheney left the company in 2000 to be George W. Bush’s running mate.
The bankruptcy was filed in Pittsburgh because most of the asbestos claims were filed against a former Dresser subsidiary, Pittsburgh-based Harbison-Walker Refractories Co. That company filed for Chapter 11 bankruptcy in 2002.
Shares of Halliburton closed down 28 cents at $27.94 Monday on the New York Stock Exchange.