TerraForm Global Inc., a unit of troubled U.S. solar energy company SunEdison Inc., said on Monday its lenders had agreed to a one-month extension to file its annual report, after the company missed a March 30 deadline, Reuters reported yesterday. TerraForm Global, one of two SunEdison "yieldcos," said in a regulatory filing last week that it would join its parent and fellow yieldco TerraForm Power Inc. in delaying its annual report for the year ended Dec. 31. In that filing, TerraForm Global had also warned of "substantial risk" of bankruptcy at SunEdison. TerraForm Global said yesterday that it paid $10 million as termination fees to end the deal for a Brazilian hydroelectric power plant, after warning last week that it may not complete certain deals if its parent company goes into bankruptcy.
Solar-energy company SunEdison Inc. plans to file for bankruptcy protection in coming weeks, a dramatic about-face for a company whose market value stood at nearly $10 billion in July, the Wall Street Journal reported on Saturday. The company is preparing a chapter 11 filing and is in talks with two creditor groups to obtain a loan to fund its operations during the process. Creditors are likely to take control of the company and its portfolio of power projects. SunEdison, whose stock has plunged in recent months, would rank among the largest financial collapses in recent years. The company, based about 20 miles outside St. Louis, used a combination of financial engineering and cheap debt to grow into one of the country’s biggest developers of renewable-power plants. But a proposed $1.9 billion takeover of residential-rooftop installer Vivint Solar Inc., which was terminated last month, was unpopular with investors. Meanwhile, falling oil prices caused a broad selloff for energy stocks, and capital-market turbulence stoked concerns about SunEdison’s ability to continue financing acquisitions. Read more. (Subscription required.)
In related news, businesses ranging from Silicon Valley venture capitalists to a small Massachusetts solar installer say they are owed money by SunEdison Inc., underscoring the breadth of a breakneck expansion seen contributing to the solar and wind energy company's financial woes, Reuters reported today. Two dozen legal claims have been made since the beginning of the year against SunEdison and its executives, mainly from shareholders who claim the company misled them about its financial position, a review of cases on Westlaw showed. None of the lawsuits reviewed have yet been adjudicated, nor have the claims been validated. Most are too recent for SunEdison to have filed a response to, and the company did not respond to requests for comment. SunEdison also faces a major lawsuit from solar installer Vivint Solar Inc. for failing to complete its $1.9 billion acquisition of the company. In its annual filing in March last year it disclosed only two significant lawsuits. Read more.
PostRock Energy Corp. filed for bankruptcy Friday amid falling oil prices, KOCO.com reported. PostRock also announced the resignation of directors within the company. PostRock's primary production area is focused in southeastern Kansas and northeastern Oklahoma. The company owns and operates over 2,500 wells in the area.
Goodrich Petroleum Corp. said on Friday that it plans to file for bankruptcy protection in the coming weeks after reaching a deal on the terms of a debt-for-equity swap with its junior bondholders, the Wall Street Journal reported on Saturday. The Houston-based oil and gas company said it plans to file a pre-packaged bankruptcy plan by April 15 after striking a deal with its second-lien bondholders that calls for them to swap $175 million in debt for 100 percent of the reorganized Goodrich. Under the proposed restructuring agreement outlined in a regulatory filing, senior lenders would be paid in full or have their debt reinstated. The reorganized Goodrich, which drills for crude oil and natural gas in the Tuscaloosa Marine shale formation in Louisiana and Mississippi, would emerge from the anticipated bankruptcy as a going concern with its day-to-day operations substantially intact. Read more. (Subscription required.)
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The federal judge who presided over some of the complex legal battles that arose following the collapse of Bernard Madoff’s Ponzi scheme got a new messy dispute to untangle — bondholders versus Caesars Entertainment, the Wall Street Journal reported on Saturday. Judge Jed Rakoff has been reassigned the four bondholder lawsuits now pending against Caesars in a Manhattan district court, court records show. The reassignment follows the news that Judge Shira A. Scheindlin, who had previously overseen the litigation, will retire April 29, just days before a trial on two of the suits was scheduled to begin.
Solar and wind installer SunEdison Inc. said in a regulatory filing that the government’s seeking information about the scrapped Vivint deal and the conduct of a former employee alleged to have committed wrongdoing “in connection with the Vivint termination negotiations,” Bloomberg News reported today. The company was also asked for documents involving “intercompany” transactions with its TerraForm Power Inc. and TerraForm Global Inc. units, the financing of the company’s projects in Uruguay and investigations initiated by its audit committee, the filing shows. The Justice Department’s subpoena comes about three weeks after the deal with Vivint, a takeover that drew the ire of billionaire investor David Tepper, was canceled. Vivint sued SunEdison shortly after, saying its officials had failed to meet financial obligations and work toward consummating the merger. SunEdison auditors had meanwhile started investigations into allegations made by former executives and a current employee about the accuracy of the company’s “anticipated financial position.”
Valeant Pharmaceuticals International Inc.’s directors and key officers have received a cease-trade order by the securities regulator in the Canadian province of Quebec, on the company's request, Reuters reported yesterday. In a separate statement, the Autorité Des Marches Financiers (AMF) said the order against trading shares takes effect Thursday and is in place for 15 days. Included in the order are Chief Executive Mike Pearson, Chief Financial Officer Robert Rosiello and board member Bill Ackman. The order states that AMF intends to issue a new order if Valeant does not make filings by April 15. The delay in Valeant filing its annual report poses a risk of debt default, Valeant said March 15, generating new scrutiny of the much-criticized company. The company is largely run out of the United States, but it is headquartered in Laval, a suburb of Montreal, Quebec.
Bankruptcy Judge Kevin Carey agreed to extend the shield of U.S. bankruptcy law to Abengoa SA while the Spanish renewable energy company works to secure creditors’ support for a restructuring plan, the Wall Street Journal reported today. Judge Carey yesterday agreed to preliminarily shield Abengoa SA and a host of affiliates from any creditor actions in the U.S., extending a protection that Abengoa has already secured from a Spanish court. Abengoa this week sought protection under chapter 15 of the U.S. bankruptcy code, which is available to foreign companies, after 75 percent of its financial creditors signed on to a standstill agreement that gives Abengoa until the end of October to reach a comprehensive restructuring agreement without the threat of its creditors interfering with those efforts. Read more. (Subscription required.)
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