Trash Firm Gets Reprieve on Its Sale

A federal bankruptcy judge said Thursday that a plan to reorganize eastern Ventura County’s largest trash hauler might work--possibly saving the company from being auctioned to the highest bidder.

Judge Robin Riblet reviewed a disclosure statement submitted by attorneys from G. I. Industries that outlined how the trash company would pay off creditors.

Although it is not a formal plan of reorganization, the disclosure statement lists the various claims against G. I. and describes how the company plans to repay those claims. Riblet said the disclosure statement only had to pass the “sniff test,” showing that there was a possibility it could work.

“I was shocked to say to myself, ‘Huh, this could work,’ ” Riblet told the court. “This is a conceivably confirmable plan.”

Three other plans for reorganization have failed to win approval since G. I. declared bankruptcy in August 1992.

If Riblet had not ruled in favor of G. I., the company--which has exclusive contracts to pick up rubbish for about 40,000 customers in Simi Valley, Thousand Oaks and Moorpark--was set to be offered for sale with bidding on the company beginning next Thursday.

Riblet’s decision buys the company about three months to stave off an auction, which the firm’s founders had staunchly opposed but rival trash firms had eyed eagerly.

Manny and Sam Asadurian of Moorpark, the two brothers who started the family trash empire 50 years ago, said they were pleased with the decision, though reorganization would bring with it their resignation.

“We wanted to retire anyway,” Manny Asadurian said. “At least we’ll be able to keep it in the family.” Their sons, Carl and Manny Jr., would be allowed to remain as executives with the company.

The waste industry’s two largest firms--Waste Management and Browning Ferris Industries--had expressed interested in possibly buying G. I., which is expected to generate revenues in excess of $19 million this year.

The company has already attracted an unsolicited bid of $24 million. News of the possible sale soured negotiations in September on a long-term trash contract in Moorpark. The company and city officials had reached a tentative agreement for a five-year contract to pick up half of the city’s residential and commercial trash.

But when the City Council learned about a possible sale it postponed a decision on the contract. At a meeting Wednesday night, the council voted to hold off for another two weeks to see what Riblet would decide.

One of the biggest obstacles to G. I.’s plan of reorganization is a claim by Western Waste Industries--a San Fernando Valley-based company that is owed from $5 million to $12 million by G. I.

Joel Ohlgren, an attorney for Western Waste Industries, objected to G. I.’s plan in court Thursday, doubting the company’s ability to equitably pay all its creditors and calling the proposal “the Rumpelstiltskin plan, because it tries to weave straw into gold.”

G. I. is also facing an even larger claim by the Benedor Corp. That company is suing G. I. subsidiary Conejo Enterprises for more than $40 million, a figure that Benedor says it is owed because of breach of a 20-year contract to recycle green waste for G. I.

G. I. filed for bankruptcy protection in August 1992 after losing several million dollars on failed attempts to diversify its business holdings.

The company has since sold its unprofitable subsidiaries, cut staffing and focused its operations solely on picking up commercial and residential trash in eastern Ventura County and parts of L. A. County.