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Natural gas driller Augustus Energy Resources LLC filed for chapter 11 protection Friday and intends to sell its assets which include wells in eastern Colorado to oil and gas investor OWN Resources Inc., subject to higher bids, WSJ Pro Bankruptcy reported. Augustus Energy, which is privately owned, said it has been squeezed by falling natural gas prices and significant debt service payments that forced the company to stop drilling new wells, according to court papers filed in the U.S. Bankruptcy Court in Wilmington, Del. The driller owns approximately 1,575 natural gas wells in the DJ Basin, located primarily in Yuma County in eastern Colorado. Augustus Energy President and Chief Executive Officer Steve Durrett said in a declaration filed with the court that his company entered into an asset purchase agreement with OWN Resources on Thursday. The stalking-horse agreement, which must be approved by a judge, would set the floor for the price of Augustus Energy’s assets at a potential auction. The terms of the purchase agreement with OWN Resources weren’t immediately disclosed.

The Roman Catholic Diocese for eastern Montana has filed a motion seeking dismissal of its bankruptcy case as it tries to settle claims from people who say that they were sexually abused as children by diocese priests, nuns or other church employees, the Associated Press reported. The Diocese of Great Falls-Billings filed for bankruptcy protection last year in an effort to negotiate a financial settlement, but those talks have reached an impasse. The diocese's court filing on Tuesday says that the two sides are a substantial distance apart and the ongoing legal costs are draining resources available for a possible settlement. Attorneys for the 82 claimants argue the assets of 14 the diocese's 50 parishes should be available to settle claims. The diocese counters that those funds are being held in trust on behalf of the parishes and should not be part of any settlement.

Barring a last-minute buyer, Toys ‘R’ Us will soon disappear from U.S. shopping centers, but the name and its iconic Geoffrey the Giraffe mascot are likely to survive for another generation of Toys ‘R’ Us kids, Reuters reported. Buyers often swoop in on retailers that are going out of business and scoop up brands with an eye on maintaining ties with loyal customers, minus the bricks and mortar. “Toys ‘R’ Us — that’s a fabulous name,” said Cathy Hershcopf, an attorney who specializes in retail bankruptcies. “The jingle, the customer lists, the logo ... and the giraffe goes along with it.” Brand specialists said that they could not put an estimated value on the name, but it will be among the most valuable ever to become available through a bankruptcy liquidation. The name adorns stores in 38 countries, from Australia to Zambia.

Claire’s Stores Inc. has filed for chapter 11 protection, the girls’ accessories retailer said on Monday, as it succumbs to lower mall traffic like many of its peers, Reuters reported. Claire’s expects to reduce debt by about $1.9 billion, and said it reached an agreement with creditors including Elliott Management Corp and Monarch Alternative Capital LP, which will give the company some $575 million in new capital. Claire’s, which had over $1.3 billion in annual sales, joins several other U.S. retailers in bankruptcy as people increasingly shop online, shunning specialty brick-and-mortar stores. Claire’s has received a commitment of $135 million in debtor-in-possession financing from Citigroup, and expects to complete the chapter 11 process in September. The Hoffman Estates, Ill.-based retailer’s international subsidiaries are not part of the U.S. bankruptcy filings, Claire’s said in a statement. Read more. 

Explore various strategies on how the tough times ahead for clients in the newspaper, brick-and-mortar retail or coal industries can be addressed in a bankruptcy, whether through a restructuring or a wind-down and liquidation of the company. Make sure to attend the "Obsolescence as a Catalyst" session at the Annual Spring Meeting. 

Southeastern Grocers LLC, which operates supermarket chains Winn-Dixie and Bi-Lo, said on Thursday it is preparing to file for bankruptcy and would shutter 94 underperforming stores, Reuters reported. “We conducted a thorough review of our strategic options,” Chief Executive Anthony Hucker said. The company said that it plans to file with the U.S. Bankruptcy Court in Delaware by the end of this month. The restructuring would reduce overall debt levels by more than $500 million and help the Jacksonville, Florida-based company invest more in its business, Southeastern said, adding that it would continue to operate 582 stores.

Toy retailer Toys ‘R’ Us Inc. yesterday asked a bankruptcy court for approval to stop paying all of its suppliers while it tries to line up buyers for its international business ahead of a planned liquidation of its U.S. operations, Reuters reported. The iconic toy store’s plan to liquidate inventory and shutter or sell its U.S. stores has put 30,000 jobs at risk and left vendors wondering where to send merchandise stuck on ships and trucks, and whether their invoices will ever get paid, lawyers said at a court hearing on yesterday. As shoppers flock to Amazon.com Inc and children choose smartphones and screens over toys, Toys ‘R’ Us has struggled to boost sales and service debt following a $6.6-billion leveraged buyout by private equity firms in 2005. At a hearing at U.S. Bankruptcy Court in Richmond, Virginia, Toys ‘R’ Us lawyer Joshua Sussberg said that the company was working to avoid any contagion from the U.S. liquidation on the foreign businesses it is trying to sell. Part of that effort means separating the U.S. business from foreign operations to ensure that shipments can reach stores in Canada, Europe and Asia, where the company will be reviewing bid proposals in coming weeks. Read more. 

One of the worst outcomes for a business owner is having a major customer file for bankruptcy and leave behind a large unpaid account receivable. ABI's Business Creditor’s Guide to Distressed Vendors, Debt Collection and Bankruptcy provides an insider’s look into the options available to help screen a business’s customers, plan for worst-case scenarios, and, if the situation does arrive, efficiently handle the fallout. 

iHeartMedia Inc., the company behind the biggest U.S. radio broadcaster, filed for bankruptcy protection after reaching an agreement in principle with investors over a balance-sheet restructuring, a decade after a private-equity-led buyout left the company laden with billions in debt, WSJ Pro Bankruptcy reported. iHeartMedia said today that the agreement in principle was with holders of more than $10 billion of its outstanding debt and its financial sponsors. The chapter 11 filing in the U.S. Bankruptcy Court for the Southern District of Texas, Houston Division, came after months of talks with investors on restructuring terms. Based in San Antonio, iHeart operates 856 terrestrial stations and controls Clear Channel Outdoor Holdings Inc., one of the biggest billboard companies in the world. The company said Clear Channel Outdoor and its subsidiaries didn’t commence chapter 11 proceedings. It also said its day-to-day operations would continue as usual during the restructuring process. iHeartMedia said it believes its cash on hand, together with cash generated from continuing operations, will be sufficient to fund and support the business during the bankruptcy proceedings.

Toys “R” Us Inc. told employees yesterday that the struggling big-box retailer will sell or close all its U.S. stores, a collapse that threatens up to 33,000 American jobs in the coming months, WSJ Pro Bankruptcy reported. The 70-year-old chain, which filed for bankruptcy protection in September, has more than 700 remaining U.S. locations, including Babies “R” Us stores. It would be one of the biggest retail liquidations since Sports Authority filed for bankruptcy in 2016 with 14,500 workers and closed more than 460 stores. Chief Executive David Brandon delivered the company’s fate to workers at its Wayne, N.J., headquarters.

Miami International Medical Center LLC, which ran the recently closed Miami Medical Center, has filed Chapter 11 while listing $31.4 million in assets versus $67.3 million in liabilities, the Miami Business Journal reported. The nonprofit Nicklaus Children’s Hospital is heavily involved in this company. It serves as a shareholder, lender and landlord to Miami International Medical Center. And more funding from Nicklaus Children’s Hospital could help resolve this case. The 67-bed hospital suspended patient services in October 2017 and terminated 180 employees. It had been operating for about 20 months after being closed for $70 million in renovations by its new owners.

By declaring bankruptcy for the investment vehicles that raised $2.5 billion to back her efforts to salvage troubled businesses, turnaround executive Lynn Tilton managed to delay a Delaware Supreme Court showdown over who owns the businesses she has been running, WSJ Pro Bankruptcy reported. Lawyers for the opposing sides appeared yesterday in the U.S. Bankruptcy Court in Wilmington, Del., for the first hearing since Tilton sought protection on Sunday for the three Zohar funds, the vehicles that carried investor money to a collection of troubled businesses she manages. Tilton said at the time of the filing she wanted to stop a legal war being waged over the portfolio of distressed businesses, which covers some dozen lawsuits in eight different courts.