Kaiser Aluminum Exiting Chapter 11

Kaiser Aluminum Corp. said Monday that a bankruptcy judge approved the company’s plan to end four years of Chapter 11 protection this quarter.

The exit plan now requires approval from a U.S. District Court judge, Kaiser said. Under the plan approved by Bankruptcy Judge Judith Fitzgerald in Wilmington, Del., Kaiser plans to cancel its stock and swap debt for equity.

“The finish line is within sight,” Chief Executive Jack Hockema said in a statement. Foothill Ranch-based Kaiser posted a $746.8-million loss in 2004 on sales of $942.4 million.

Kaiser filed for protection from creditors in February 2002 in the face of more than 120,000 asbestos claims.

Inhalation of asbestos, widely used for insulation and fireproofing until the 1970s, is blamed for lung disease.

Most of Kaiser’s new equity will go to two employee benefit associations that provide medical care for retirees.

Personal injury claims relating to asbestos, silica and coal-tar pitch and hearing loss will be funded mainly by insurance proceeds through trusts, Kaiser said.

Kaiser, with 2,000 employees, makes aluminum products for the aerospace, automotive and general engineering industries.