GRACE REACHES ASBESTOS DEAL

Asbestos claimants have reached an agreement with W.R. Grace that may allow the firm to emerge from seven years of bankruptcy by the end of 2008. The deal will set up a trust fund worth more than $3 billion to compensate all present and future asbestos-related personal injury claimants. Under the plan, reached with claimant representative committees set up by the U.S. Bankruptcy Court in Pittsburgh, Grace will make an initial cash contribution of $250 million to fund the trust and then pay a further $1.6 billion over 15 years. The company will also contribute rights to its asbestos liability insurance coverage, which could amount to about $900 million, and rights to buy 10 million shares of Grace stock. In addition, the trust will contain cash and stock now worth about $1.2 billion from Fresenius Medical Care and Sealed Air, companies that had acquired former Grace businesses. An asbestos claimants committee had sued the two ...