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E-II REACHES SETTLEMENT WITH MCCRORY PARENT CORP. CREDITORS' COMMITTEE

 NEW YORK, March 19 /PRNewswire/ -- E-II Holdings and its official committee of unsecured creditors announced today that they have reached an agreement to settle a $962 million claim asserted against E-II by the official creditors' committee of McCrory Parent Corp. and an approximately $1.6 billion claim asserted by E-II against McCrory Parent Corp.
 The settlement provides that McCrory Parent Corp. will have an allowed claim of $38.5 million against the litigation trust (with recovery on such claim having an estimated present value of $19 million) created under the E-II chapter 11 plan and that E-II will not pursue its claims against McCrory Parent Corp. The litigation trust is being established to pursue claims that E-II currently has against Meshulam Riklis and his affiliates. E-II will have a contingent funding obligation to the litigation trust of up to $37 million. Under the settlement, McCrory Parent Corp. will transfer certain of its own claims against Meshulam Riklis and his affiliates to the litigation trust and receive a 25 percent beneficial interest in the recoveries under E-II's litigation trust.
 In addition, the unsecured creditors' committee of McCrory Parent Corp. has agreed, among other things, to support E-II's chapter 11 plan. The settlement is subject to the approval of the bankruptcy court in each of E-II's and McCrory Parent Corp.'s chapter 11 case and consummation of the E-II chapter 11 plan.
 E-II believes that the settlement reached with the McCrory Parent Corp. creditors' committee represents a very positive step toward E-II's successful reorganization. The bankruptcy court has approved changes to E-II's disclosure statement to describe the terms of the settlement. E- II expects to commence solicitation of votes for its plan next week. The court has scheduled a confirmation hearing for May 24, 1993.
 -0- 3/19/93
 /CONTACT: Michael Levine, public relations of MWW-Strategic Communications, Inc., 201-342-9500, for E-II Holdings/


CO: E-II, McCroy Parent Corp. ST: New York IN: FIN SU:

LD -- NY077 -- 8121 03/19/93 18:53 EST
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Publication:PR Newswire
Date:Mar 19, 1993
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