Junior creditors of frac-sand supplier Covia Holdings are looking to pursue fraud claims against the company’s current and former officers, shareholders and lenders stemming from the 2018 merger that the creditors say was the cause of Covia’s bankruptcy.
The Independence, Ohio-based company, represented by Kirkland & Ellis, filed for bankruptcy in June in the U.S. Bankruptcy Court for the Southern District of Texas with a restructuring strategy that would allow lenders to take over Covia. The company’s unsecured creditors’ committee argued in court papers on Wednesday that Covia is trying to rush through a reorganization plan that will allow it to shield parties involved in the 2018 merger from potential liability.
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