Shale driller Unit Corp. has filed for bankruptcy with a creditor-backed plan to trim more than $650 million in long-term debt from its balance sheet, the Wall Street Journal reported. Tulsa, Okla.-based Unit has agreed to swap out bond debt for equity in the reorganized business and has also lined up a $180 million exit facility to propel the business out of chapter 11 later this year, according to papers filed on Friday in the U.S. Bankruptcy Court in Houston. The company said that it has signed a restructuring support agreement outlining the plan backed by its senior lenders and holders of about 70 percent of its bond debt. Unit has also lined up chapter 11 financing that includes $36 million in fresh loans and would “roll up” as much as $96 million in prebankruptcy loans, court papers say. A roll-up vaults debt ahead of a bankrupt company’s other financial obligations in terms of repayment in chapter 11. The bankruptcy financing, which must be approved by a judge, includes a milestone that requires the bankruptcy court to confirm its chapter 11 plan in just under three months. Unit said its vendors and suppliers won’t be affected by the bankruptcy. A midstream business in which Unit owns a 50 percent stake, Superior Pipeline Co., isn’t included in the chapter 11.
