Capmark 'to file for bankruptcy'

NEW YORK: Capmark Financial Group Inc, the commercial real estate company created through a 2006 leveraged buyout of certain GMAC assets, is preparing to file for bankruptcy possibly by the end of next week, according to a source with direct knowledge of the situation.

The company, which owns a bank that will continue to operate while it is in court, is in negotiations with lenders, bondholders and the Federal Deposit Insurance Company that will result in a filing by the end of October at the latest, the source was quoted as saying.

They are working on details of a debt-for-equity swap that will take place to bring the company back out of bankruptcy, said the source.