SunEdison’s junior creditors to conduct bankruptcy probe

According to an announcement in the New York court, bankrupt solar power producer SunEdison allowed its unsecured creditors to investigate its bankruptcy amid an agreement the company reached with its junior creditors on its finance package.

SunEdison, carrying debt of $16bn at the time of filing for bankruptcy. The troubled company hasn’t yet filed audited financial statements for 2015.

It appears that during court proceedings, creditor’s evaluation of SunEdison’s financial affairs revealed little information regarding SunEdison’s subsidiaries that were not involved in the bankruptcy.

In exchange for the right to investigate, SunEdison’s unsecured creditors agreed to withdraw opposition to the company’s $300m bankruptcy financing package

SunEdison’s yieldcos or its most significant creditors, TerraForm Power Inc. and TerraForm Global Inc., reached an agreement designed to make sure the company that once owned them would be able to meet its obligations to them.

The committee investigation would replace a probe SunEdison had earlier requested, one that creditors declared to be too limited in scope and budget.

In addition, SunEdison’s bankruptcy financers, which are also the company’s senior lenders, agreed to free up for junior creditors up to $50m of insurance coverage available under the company’s officers and directors liability insurance coverage.

Source: WSJ

 

SunEdison bankruptcy loan hearing moved to Friday

SunEdison’s scheduled hearing on Thursday in a New York bankruptcy court on its $300m bankruptcy loan was postponed until Friday.

Some of SunEdison’s creditors and its so-called yieldcos, TerraForm Global Inc. and TerraForm Power Inc., had objected in court papers to the debtor-in-possession loan, which includes features that may help a group of lenders recoup their initial investment.

According to SunEdison’s attorney Jay Goffman, a deal on the DIP loan was expected by Friday.

SunEdison filed for bankruptcy in April after its ambitious growth plan proved unsustainable. It received approval from a judge last month to tap some of the DIP loan.

Source: Reuters

Penn West warns it may default on debt; stock tumbles

Canada-based oil and gas producer Penn West Petroleum Ltd. warned it could be in violation of its lending agreements by the end of June 2016, leading to its shares losing a quarter of its value in Monday’s trade.

The company said that it had hired investment banking firm Rothschild of New York and accounting firm PWC of Calgary as advisers as it negotiated with its lending syndicate to ease conditions that could result in default if not met by 30 June 2016.

A default would allow the lenders to demand immediate repayment.

Penn West stock fell as low as $0.78 per share on Monday morning, down 26 per cent from its close of $1.05 on Friday. A year ago, Penn West stock was trading over $3 a share.

With debt of $1.87bn as of 31 March 2016, the company is required to maintain covenants on its senior debt and total debt to adjusted earnings. But depressed oil prices have led to a steep fall in earnings as compared to its debt.

Source:  The Star

 

VLM Airlines files for 6 month creditor protection

Belgium-based VLM Airlines filed for bankruptcy protection in an Antwerp commercial court.

The move, if approved, would grant the airline operator creditor protection for a period of six months, enabling it to restructure operations.

According to VLM’s CEO Hamish Davidson,  the company expected that the judicial reorganization would enable it to repay historical debts and suppliers and ensure the smooth running of daily operations.

KBC Bank’s decision to freeze VLM’s accounts on Wednesday last week triggered the filing, equivalent to Chapter 11 in the United States.

The airline’s debts reportedly included €3m ($3.4m) owed to the bank as well as an additional €3m owed to various suppliers which include the Antwerp Airport.

The operator had suffered a €13m ($14.7m) loss for its last financial year making it abandon plans to lease four SSJ 100-95 LRs from Russian lessor, the Ilyushin Finance Co., earlier this year.

At present, VLM operates eleven Fokker 50s (of which two are leased to each of Cityjet and flybe) on passenger charter flights as well as scheduled passenger flights between Belgium, Switzerland, Germany, the United Kingdom, Ireland, the Netherlands, Italy, and Norway.

Source:  Ch-aviation

SunEdison’s yieldcos given more time to file delayed reports

SunEdison Inc.’s yieldco’s TerraForm Power Inc. and TerraForm Global arranged for more time to file their financial reports for 2015, thus helping them avoid a potential technical default on their credit facilities. The agreement was approved by lenders on Tuesday.

TerraForm Power Inc. has until 28 May 2016, to file its annual financial results whereas TerraForm Global Inc. could get an extension period of almost 10 months, in exchange for reducing the size of its own revolving credit line to $350m from $485m.

As per an SEC-filing, TerraForm Power would also delay the release of its 1Q’16 report as it had identified “material weaknesses in internal controls over financial reporting,” including the valuation of costs of projects acquired from SunEdison and processing accounts payable and general and administrative expenses.

The yieldcos delayed releasing their annual reports partly due to the assistance needed from their bankrupt parent SunEdison, which also hasn’t filed its reports. Parent company SunEdison had sought bankruptcy protection in April 2016.

TerraForm Global did not provide a specific new deadline in the filing but it had until either 30 March 2017, or 10 business days before “failure to deliver such financial statements would constitute an event of default” for another debt, its senior notes due 2022, whichever came first.

Source: Bloomberg

Property developer Kaisa Group files for Ch-15 restructuring

Kaisa Group Holdings Ltd., a Shenzhen, China-based property developer filed a Chapter 15 petition (Case: 16-11303) in the Manhattan court on 5 May 2016. The company used this provision of U.S. bankruptcy law to deal with U.S. creditors or lawsuits when reorganizing in a Hong Kong court.

Kasia had $14.9bn in debt, backed by $16.1bn of assets.

Kaisa stated that holders of 96% of its offshore debt, supported the company’s restructuring agreement negotiated in the Hong Kong.

The company anticipates that the Hong Kong court will approve its restructuring plan.

Further, the company plans to meet with creditors on 20 May 2016.

Source: Bloomberg

CHC Group files for Chapter 11 bankruptcy

U.S-based CHC Group Ltd., which is engaged in the provision of transportation services to the offshore oil and gas industry, filed for Chapter-11 bankruptcy. The filing came days after a fatal accident of one of its helicopters in Norway, which forced the company to ground much of its fleet.

As of 31 January 2016, the company had debt of $2.19bn against assets of $2.17bn and operated a fleet of 231 helicopters as on 31 January 2016. Industry experts estimated that one-fifth of the company’s fleet was idle, due to lack of demand for its services from oil & gas companies, forcing it to explore cost-cutting options.

Further, on 15 April 2016, the company missed a $46m interest payment on approximately $1bn of its bonds, triggering a 30-day grace period to make the payment and avoid default.

Weil Gotshal & Manges and Debevoise & Plimpton are the legal representatives of the company.

Financial advisers to CHC are Seabury Advisors, PJT Partners and CDG Group.

Source: WSJ