Vertellus Specialties Inc., a global manufacturer of fine and specialty chemicals, announced that a bankruptcy court has approved the sale of substantially all of Vertellus' assets to the company's existing term loan lenders, the ABL Advisor reported on Friday. The Court's decision follows the successful resolution of all remaining objections raised by the company's creditors, environmental regulators and other business partners to allow for a consensual asset sale. The transaction is expected to be completed by the end of September.
Apollo Global Management LLC and TPG Capital offered to pay $250 million to help get Caesars Entertainment Operating Co. out of bankruptcy, according to two Apollo executives, contradicting claims that the casino company’s private-equity sponsors refused to spend their own money to make peace with creditors, Bloomberg News reported today. A mediator working to foster agreement between bondholders and parent company Caesars Entertainment Corp. asked Apollo and TPG whether they “would fund up to $250 million to reach a ‘best and final’ deal” that paid the bondholders 58 percent of what they are owed, Apollo executives Marc J. Rowan and David B. Sambur said in a filing on Wednesday in Chicago federal court. The mediator “was advised that the sponsors would provide the incremental funding,” Rowan and Sambur said in the filing, which asks U.S. Bankruptcy Judge A. Benjamin Goldgar to block the bondholders’ request for personal financial information. Settlement talks involving Rowan and Sambur last month failed to produce a deal, according to Wednesday’s filing. The executives said the bondholders demanded “several times” the $250 million offered.
A consortium led by Simon Property Group Inc. and General Growth Properties Inc. won an auction for the assets of Aeropostale Inc., with a plan to keep open 229 of the the bankrupt teen retailer’s stores, Bloomberg News reported today. The bidding group will also keep the chain’s online business and licensing operation up and running, according to a statement yesterday. A bankruptcy judge must still approve the deal after reviewing the terms and any objections as a hearing on the matter has been set for Sept. 12. Aeropostale filed for bankruptcy in May, succumbing to competition from big-box stores, online merchants and “fast fashion” purveyors. The company also accused lead lender Sycamore Partners of pushing it into chapter 11 to buy it on the cheap. The bankruptcy judge rejected that claim and allowed the private equity firm to take part in the auction. Read more.
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Hedge fund manager D.E. Shaw & Co LP is weighing a bid for SunEdison Inc.’s controlling stake in TerraForm Power Inc., the bankrupt U.S. renewable energy producer's most valuable asset, Reuters reported yesterday. D.E. Shaw's emergence as a possible bidder for TerraForm Power indicates that the potential sale process for the so-called "Class B" shares of TerraForm Power, which was formed by SunEdison to buy and operate its solar and wind power plants, is likely to be competitive. Another hedge fund, Appaloosa Management LP, and asset manager Brookfield Asset Management Inc., have already announced plans to jointly bid on SunEdison's TerraForm Power Class B shares. D.E. Shaw and its affiliates already own some of the publicly traded common shares of TerraForm Power. They received them in an agreement announced last year after forgiving debt owed by SunEdison, regulatory filings show.
NextEra Energy Inc. has reached agreement with financial institutions on its bid to buy Energy Future Holdings Corp.’s Oncor Electric Delivery Co. utility in Texas, Bloomberg News reported today. As part of the transaction, NextEra plans to fund $9.5 billion, primarily for the repayment of about all of the Energy Future Intermediate Holding Company debt, NextEra said today. NextEra has proposed to take over the biggest transmission operator in a state where regulators have already proven they can drive a tough bargain. An investor group led by Dallas-based Hunt Consolidated Inc. tried and failed in May to buy Oncor. At stake is a transaction that’s key to Energy Future’s emergence from one of the biggest bankruptcies of all time, involving the restructuring of about $50 billion in debt. NextEra has previously agreed to buy all of the equity of reorganized Energy Future Holdings and certain of its direct and indirect subsidiaries, including Energy Future Holdings’ approximately 80 percent indirect interest in Oncor.
Energy Future Holdings Corp., Texas' biggest power company, won bankruptcy court approval on Friday for a plan that will allow the bulk of its operations to exit chapter 11 after two years of battling creditors, Reuters reported. "I am going to overrule all of the remaining objections,” said Bankruptcy Judge Christopher Sontchi. Dallas-based Energy Future filed for bankruptcy in April 2014 when weak electricity prices left it unable to service $42 billion in debt, mostly related to the company's creation through a 2007 leveraged buyout. The reorganized company will own TXU Energy, the state's largest retail electric utility, and Luminant, Texas' largest power plant operator and largest coal miner. The spinoff of the two divisions into the new company avoids a tax liability that had worried creditors. The potential for a "massive" tax liability was the "elephant in the room," Judge Sontchi said on Friday, adding that he believed the plan "was the best possible deal" to push the company out of bankruptcy.
A bankruptcy judge has dealt a big blow to Aéropostale Inc.’s bid to survive chapter 11, refusing to rein in the bidding rights of Sycamore Partners, a former big backer and now major critic of the retailer, the Wall Street Journal reported on Saturday. Bankruptcy Judge Sean Lane, in a decision signed Thursday but not made public until Friday afternoon, said that Sycamore is entitled to wield its $151 million loan as currency at the bankruptcy auction of the retail chain, a credit-bid that gives it an advantage in the competition. The ruling portends bad news for landlords and employees of the teen fashion retailer, which has been at odds with Sycamore since before it filed for bankruptcy protection in May. The private-equity firm has said liquidation may be the best outcome for Aéropostale and its stores, and scoffed at the company’s hope of a job-saving turnaround. The credit-bid means Sycamore can walk into the auction without cash, and demand rival bidders pay off the $151 million loan from Sycamore if they want to save, or liquidate, the company. During arguments, Aéropostale warned that allowing Sycamore to credit-bid makes it unlikely that anyone but liquidators will show up at the auction. Read more. (Subscription required.)
Bankruptcy Judge A. Benjamin Goldgar said yesterday that Caesars Entertainment Corp. is unlikely to get protection from bondholder lawsuits that would last as long as its insolvent operating company is in bankruptcy, Bloomberg News reported. Judge Goldgar today will decide whether to extend a halt on lawsuits in New York and Delaware, and if so, for how long. Goldgar made it clear yesterday that he would not give Caesars a lawsuit shield that lasts until after Caesars Entertainment Operating Co. wins approval of its reorganization plan, which can’t happen until next year at the earliest. “I’ve said that isn’t going to happen,” Goldgar said yesterday near the end of a three-day hearing on possibly halting bondholder lawsuits that could impose $11.4 billion in judgments on the parent company. The lawsuits are the biggest obstacle left to getting Caesars’ main operating unit out of bankruptcy. Bondholders want to use the suits, which a court examiner found have a good chance of succeeding, to boost their recoveries to more than the 34 percent offered by CEOC.
Spanish renewable energy firm Abengoa SA has sold five of its Midwestern U.S. ethanol plants for $357 million as the company looks to stave off what would be Spain’s largest-ever corporate bankruptcy, the Wall Street Journal reported today. Green Plains Inc. of Omaha, Neb., which operates 14 plants and has an ethanol-marketing unit, is paying $200 million for Abengoa plants in Mount Vernon, Ind., and Madison, Ill., according to papers filed in U.S. Bankruptcy Court in St. Louis. Green Plains also topped Houston-based BioUrja Trading LLC, an ethanol-marketing firm that doesn’t have production operations, for Abengoa’s York, Neb., plant with a $37.4 million bid at bankruptcy auction Monday. An affiliate of plant operator KAAPA Ethanol LLC of Minden, Neb., is paying $115 million for Abengoa’s Ravenna, Neb., plant. And ICM Inc. is picking up Abengoa’s shuttered plant in Colwich, Kan., for $3.15 million.
