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Bankruptcy Judge Brendan L. Shannon signed off on New Gulf Resources LLC's restructuring plan, allowing the troubled energy company to wipe roughly $590 million of debt from its balance sheet and to move closer to exiting chapter 11 protection, Dow Jones Daily Bankruptcy Review reported yesterday. The reorganization plan will allow New Gulf, which sought chapter 11 protection late last year, to convert about $590 million in secured and unsecured bonds into equity. New Gulf will issue $135.25 million in new first-lien bonds to its creditors, and some of the new debt will be used to pay down the company's $75 million bankruptcy loan. That loan, from a group of New Gulf's second-lien bondholders, was used to fund the costs of the restructuring and to repay $38 million owed to senior lender MidFirst Bank. The chapter 11 plan will leave New Gulf in the hands of its two bondholder groups. Second-lien bondholders, owed $365 million in principal, will receive about 87.5 percent of New Gulf's new equity and the holders of subordinated paid-in-kind bonds, owed $162 million, will take a roughly 12.5 percent stake. Read more. (Subscription required.) 

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Aeropostale Inc., the teen-clothing chain that has suffered years of losses, is preparing to file for bankruptcy as soon as this month, Bloomberg News reported yesterday. The company is looking to reorganize under chapter 11 protection as Aeropostale is trying to work out a loan to finance its operations during the bankruptcy process. A deal to avert a filing or find a buyer also could still emerge. Aeropostale’s trip to bankruptcy court would follow three straight years of losses and a feud with its main lender, Sycamore Partners, which also owns a key clothing supplier. The New York-based retailer has struggled to hang on to teen consumers, who have shifted to online shopping or chains like H&M. The company said last week that it would delay filing its annual report while it explores its options. Aeropostale announced plans in March to evaluate strategic alternatives, tapping Stifel Financial Corp. to help assess a possible sale or restructuring. The company also is working with law firm Weil Gotshal & Manges LLP and FTI Consulting Inc.

SunEdison Inc., once the fastest-growing U.S. renewable energy company, filed for chapter 11  protection yesterday after a short-lived but aggressive binge of debt-fueled acquisitions proved unsustainable, Reuters reported yesterday. In its bankruptcy filing, the company said that it had assets of $20.7 billion and liabilities of $16.1 billion as of Sept. 30. SunEdison's two publicly traded subsidiaries, TerraForm Power Inc. and TerraForm Global Inc., are not part of the bankruptcy. In a statement, the companies, known as yieldcos, said that they had sufficient liquidity to operate and that their assets are not available to satisfy the claims of SunEdison creditors. The bankruptcy "will present challenges," however, including with financing agreements for certain projects, the yieldcos said. The chapter 11 filing caps SunEdison Chief Executive Officer Ahmad Chatila's seven-year quest to transform a struggling maker of silicon wafers into a renewable energy giant able to capitalize on burgeoning demand for solar and wind energy amid growing concerns about climate change. Chatila was named CEO of what was then called MEMC Electronic Materials in 2009 and almost immediately bought fledgling solar project developer SunEdison. The company changed its name four years later and embarked on a rapid expansion that included entering new businesses like wind and energy storage and taking on projects worldwide. That growth racked up billions of dollars of debt. Solar industry watchers said the bankruptcy was not a reflection of the overall financial health of the sector, which is growing rapidly.

Nova Star Cruises, the beleaguered ferry service that shuttled passengers between Portland, Maine, and Nova Scotia for two years, has filed for bankruptcy in Canada, the Portland Press Herald reported today. According to documents filed April 13 in a Halifax district court, the company owes more than $15 million to creditors and identified only $142,000 in assets. The city of Portland is owed more than $77,000, primarily in unpaid port fees that total $57,894. Singapore Technologies Maritime Ltd., the owner of the Nova Star ferry, tops the list of creditors with $11.8 million, presumably unpaid lease payments. The next largest creditor is FleetPro Ocean Inc. of Miami at $1.2 million. The court appointed Deloitte Restructuring Inc. to serve as trustee. It notified creditors of the filing yesterday, and the first meeting for creditors is set for May 4 in Yarmouth, Nova Scotia. The Nova Star ran into problems at the very beginning of its first season, in 2014. Regulatory delays pushed back the start of its sailing season, delaying ticket sales and causing it to lose charter and tour bus business that first year. Passenger numbers never reached the 100,000 goal set that first season. The Nova Star ended the season with only 59,000 people making the trek from Portland to Yarmouth, Nova Scotia.

The deal-making frenzy that hastened SunEdison Inc.’s collapse could continue to cause problems for the solar-power company during any bankruptcy, the Wall Street Journal reported today. Potential legal damages stemming from deals SunEdison failed to close while its finances were deteriorating could total hundreds of millions of dollars, according to court filings and people familiar with the deals. Litigation over the failed deals could add to the company’s already lengthy list of creditors and possibly extend to its publicly traded subsidiaries. SunEdison, once a darling of the clean-power industry, has lost 99 percent of its market value since last summer and is working with advisers on a chapter 11 filing. The company owes creditors nearly $10 billion, according to regulatory filings. Of 11 deals reached since last May, SunEdison has failed to close five with a combined value of about $3.8 billion, according to FactSet. It is in active litigation or arbitration on two of them, and other counterparties are reviewing litigation options.

One of the country’s largest phone book publishers is planning to file for bankruptcy protection next month for the third time in seven years after efforts to reposition the company to thrive in the digital age fell short, the Wall Street Journal reported today. Dex Media Inc. has reached a deal with key creditors to reduce its debt by more than $1 billion in a chapter 11 restructuring set to begin next month. Lenders including Mudrick Capital Management LP and Paulson & Co. would end up with most of the reorganized company’s equity. Dex, which published more than 1,700 yellow pages and white pages directories in 2014, plans to ask its board to approve the restructuring within a week or so.

Tulsa-based Sheehan Pipe Line Construction Co. filed for chapter 11 protection on Friday in U.S. Bankruptcy Court for the Northern District of Oklahoma, the Tulsa World reported yesterday. Founded in 1903, the 113-year-old pipeline construction company's functions have expanded to include hydrostatic testing, valve changing and pipeline rehabilitation, but the company's focus is still primarily on laying infrastructure. The company's chapter 11 filing lists both estimated assets and liabilities as being somewhere in the $50 to $100 million range. The company's estimated number of creditors are listed as in the range of 200 to 999.

Oilfield services company Seventy Seven Energy Inc. said that it intended to file for a pre-packaged chapter 11 bankruptcy on or before May 26, the latest energy company to seek bankruptcy protection amid a prolonged oil price slump, Reuters reported yesterday. The company, which was spun off from Chesapeake Energy Corp. in 2014, said that it had entered into a restructuring agreement with certain lenders that would allow it to convert about $1.1 billion of its debt into equity. A more than 60 percent fall in global oil prices since mid-2014 has forced about 50 North American oil and gas producers to seek bankruptcy protection. Weak oil prices have also prompted oil producers to severely curtail spending, weighing on demand for the oilfield services provided by companies such as Seventy Seven Energy. Read more. 

Get a better understanding of what happens when an oil, gas or other natural resources company goes bankrupt. Order your copy of ABI’s revised and expanded When Gushers Go Dry: The Essentials of Oil & Gas Bankruptcy, Second Edition. 

Foresight Energy LP reached an agreement with its senior lenders to restructure debt, a deal that may allow the struggling U.S. coal miner to avoid bankruptcy, Bloomberg News reported yesterday. The company also convinced two-thirds of the holders of its $600 million of 7.875 percent senior unsecured notes maturing 2021 on a debt exchange, according to a regulatory filing yesterday. The pact brings to an end a dispute with investors who claimed that Foresight had triggered a clause that required it to repay all of the notes at a premium when it agreed to be partially bought by rival Murray Energy Corp. last year.