Marvel's bondholders win ruling

NEW YORK -- Bondholders fighting Marvel Entertainment Group's plan to merge with Toy Biz Inc. and emerge from bankruptcy won a round in court yesterday when a federal judge ruled that the bondholders could take control of the 80 percent stake in Marvel stock that secured the bonds.

The ruling will not take effect until May 23, however, giving Marvel time to appeal.

The fight over Marvel, the comic book and sports card company, pits Marvel's board and bank lenders against the bondholders, led by Carl Icahn. Both sides have filed reorganization plans in bankruptcy court in Delaware.

The bonds were issued by companies controlled by Ronald Perelman, who owned the 80 percent stake in Marvel. If the bondholders take control of the stock securing the bonds, they plan to replace the Marvel board and install new management.

Banks led by Chase Manhattan are expected to oppose the bondholders' reorganization plan, contending that it does not offer them adequate recovery. They support Marvel's plan, which involves a merger with Toy Biz, a company Marvel now partly owns that licenses the right to make toys based on its characters.

Pub Date: 5/15/97