T-REX Stalks Vulture Investors
New auction marketplace for Chapter 11 creditors shakes up $500 billion claims trading industry.
Denver, CO (PRWEB) May 16, 2007 -- Creditors whose debtors file for Chapter 11 bankruptcy have operated at a disadvantage. Saddled with bad debt that may take years to recover, they can sell their bankruptcy claims at a discount, but the process can be daunting, with the creditor at the mercy of distressed debt buyers known as "vulture investors."
But a new company is ready to level the playing field.
Trade Receivable Exchange - or T-REX - is launching an online auction marketplace (www.t-rexauctions.com) to help creditors sell their unsecured Chapter 11 bankruptcy claims at higher prices and on more favorable contract terms -- all at the expense of vulture investors. T-REX aims to bring transparency to the claims trading market through an open bidding format.
According to the Daily Bankruptcy Review, a huge market has developed involving the trading of bankruptcy claims -- by some estimates $500 billion in such claims change hands every year.
"Chapter 11 creditors have a difficult time navigating the murky, unregulated world of claims trading, which is dominated by sophisticated hedge funds," says T-REX CEO and co-founder David Williams. "Vulture investors thrive on secrecy. Confidentiality agreements are commonly used to prevent creditors from sharing the terms of their bankruptcy claim sale. Many creditors get low-balled on pricing because they have no reliable way to research the market rate and there is rarely any head-to-head bidding for their claims. They don't know the good vulture investors from the unethical ones and, worst of all, the boilerplate contracts used to document the sale of claims are notoriously one-sided."
Creditors can join T-REX and post their bankruptcy claim auctions for free. Pre-qualified investment banks and hedge funds then bid against each other in real-time for the auction transaction, which drives up the selling price for the creditor. Winning bidders pay T-REX a commission fee when the auction transaction closes. T-REX's commission fees for bankruptcy claims start as low as 0.50% of the purchase price.
Pricing transparency is the cornerstone of T-REX's new marketplace. Creditors can actually see how much other companies are being quoted for their bankruptcy claim auctions. Additional pricing research tools are available to creditors who upgrade to T-REX's premium membership plan ($499 per year).
Auctions are anonymous and non-binding meaning the creditor can award its auction to any bidder or none at all. Creditors can analyze detailed bidder profiles and member feedback ratings to help them select the winning bidder. They can also use T-REX's "creditor-friendly" claim assignment agreement to negotiate better contract terms with the winning bidder.
About T-REX
T-REX (Trade Receivable Exchange) is the revolutionary auction marketplace for buyers and sellers of Chapter 11 bankruptcy claims and trade credit protection. T-REX enables business creditors to research the latest market pricing, post non-binding auctions for free and negotiate better terms with T-REX's creditor-friendly contracts. Leading investment banks, hedge funds and credit insurers bid head-to-head in real-time for auctions posted on T-REX. Auction categories include Chapter 11 Bankruptcy Claims, Receivable Put Options and Trade Credit Insurance. Visit www.t-rexauctions.com to learn more.
Media Contact:
David Williams, CEO & Co-Founder
Trade Receivable Exchange, Inc.
877-301-8739
david @ t-rexauctions.com
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