The Superior Court of Justice in Ontario, Canada has appointed Ernst & Young, Inc. as receiver and manager for the "property, assets and undertaking" of Livent.
Ernst & Young was requested of the court by the Livent board of directors, and had earlier been appointed monitor when the company filed for protection under Canada's Companies' Creditors Arrangement Act.
Effective with the court's appointment of Ernst & Young, the Livent board tendered their resignations as directors of the company and members of Livent's senior management are also departing the firm.
The exit of Livent's senior staff marks the finale in a spectacular business cycle -- one that started with questions about unprecedented hype, acquisition and liberal spending. Later, when new owners scrutinized company records, Livent came to symbolize mismanagement, complete with accusations of cooked books and of seriously overstated values.
According to a company statement, after the sale of Livent's major assets to SFX Entertainment, the Livent board determined that a court-appointed receiver and manager would be best suited to realize the remaining company assets and to oversee the administration of creditors' claims. All of this is being done, the company statement said, "in conjunction with the continuation of the U.S. Chapter 11 proceedings."
Livent filed for Chapter 11 on Nov. 18, 1998, and for similar protection in Canada the following day. Both of these proceedings are still underway.
Ernst & Young was unable to comment by press time.
-- By Murdoch McBride