USEC announces emergence from bankruptcy Sept. 30 as Centrus Energy

By Kali Hays

New York, Sept. 18 – USEC, Inc. said in a Thursday news release that it expects to emerge from Chapter 11 bankruptcy on Sept. 30 as reorganized company Centrus Energy Corp.

As previously reported, the company’s reorganization plan received confirmation from the U.S. Bankruptcy Court for the District of Delaware on Sept. 5.

USEC filed a pre-packaged bankruptcy on March 5 to implement a restructuring plan agreement reached in December 2013 with a majority of the holders of its senior unsecured convertible notes.

New common stock issued under the plan is expected to begin trading on the New York Stock Exchange on the effective date of the plan.

Additionally, USEC will replace its $530 million debt and its preferred stock with a new debt issue totaling $240.4 million and new common stock. The new debt issue will mature in five years and can be extended for an additional five years subject to certain conditions.

Noteholders will receive $200 million of the new debt and about 79% of the common stock.

Preferred investors Toshiba Corp. and Babcock & Wilcox Co. will each receive $20.19 million of the new debt and roughly 8% of the new common stock.

Current common stockholders will receive around 5% of the new common stock in exchange for the existing common stock, though distribution of the new common stock is subject to dilution on account of a new management incentive plan, according to a Sept. 5 news release.

All secured claims will be reinstated and otherwise not impaired, and all liens will be continued until the claims are paid in full.

All general unsecured claims will be unimpaired and will be either reinstated or paid in full in the ordinary course of business upon the later of the plan effective date or when they become due according to their terms.

USEC also said that it ended the second quarter of 2014 with cash of $123 million and “will not require an additional source of exit financing upon emergence,” according to the release.

Upon filing for bankruptcy, USEC said its board of directors and management team are substantial holders of the common stock, and their holdings will be treated exactly as all other common shareholders. In addition, any unvested or unexercised stock awards they hold will be forfeited under the plan.

A new board of directors will be brought in once the plan is in effect.

USEC, a Bethesda, Md.-based supplier of nuclear fuel and advanced technology services, filed for bankruptcy on March 5 in the U.S. Bankruptcy Court for the District of Delaware. The Chapter 11 case number is 14-10475.

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