Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
SunEdison Prepping to File for Chapter 11 Bankruptcy
Author: Joel R. Glucksman
Date: May 4, 2016
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SunEdison Prepping Chapter 11
It was recently reported that SunEdison Inc., the solar energy giant and one of the biggest developers of renewable-power plants in the U.S., planned to file for Chapter 11 bankruptcy protection within weeks. According to The Wall Street Journal, the company’s market value has plummeted from $10 billion last summer down to $400 million in one of the largest collapses since 2008.
SunEdison’s stock plunged in recent months
In reports regarding the situation, the company’s unprecedented collapse has been attributed to a historic fall of oil prices and capital market volatility. This prompted concerns about whether the company could continue to finance its impending acquisitions. Among those acquisitions was its failed $1.9 billion takeover attempt of Vivint Solar Inc., which prompted massive sell-offs from investors.
The company also confirmed that the SEC has begun to investigate whether SunEdison falsified its cash position to investors in the midst of its stock collapse. In turn, the company received a subpoena from the Justice Department concerning two of its subsidiaries.
As a result, shares of SunEdison dropped to record lows amidst investor fears of bankruptcy. Currently, the company’s market capitalization stands at $150 million, with $7.9 billion in long-term debt.
The company’s expected reorganization plan involves debt-for-equity swap
SunEdison is currently negotiating with two senior creditors to obtain bankruptcy financing through a potential restructuring period. It is anticipated that the deal would involve a debt-for-equity swap where the two creditors would assume control over the company and its portfolio of assets. The deal has been held up by competing creditors who continue to negotiate loan offers that would take SunEdison through the bankruptcy period.
Are you a creditor in a bankruptcy? Have you been sued by a bankrupt? If you have any questions about your rights, please contact me, Joel Glucksman, at 201-806-3364.
For more articles having to do with energy companies filing for Bankruptcy, check out:
- Venoco files for Chapter 11 Bankruptcy Protection
- Emerald Oil Inc Files for Chapter 11 Bankruptcy Protection
- Sundevil Holdings LLC Files for Chapter 11 Bankruptcy Protection
- Practices: Bankruptcy & Creditors' Rights, Corporate Transactions & Business, Bankruptcy Litigation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
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