Chile’s ILAP gets interim access to cash collateral; hearing Jan. 3

By Sarah Lizee

Olympia, Wash., Dec. 4 – Inversiones Latin America Power Ltda. (ILAP) received interim approval to access cash collateral, according to an order filed Friday with the U.S. Bankruptcy Court for the Southern District of New York.

Additionally, the court set a combined hearing on confirmation of the company’s pre-packaged Chapter 11 plan and final approval of the disclosure statement for Jan. 3.

As a reminder, the company intends to restructure a balance sheet burdened by $408.73 million in principal amount of outstanding funded debt under the joint pre-packaged plan.

The plan is based on a restructuring support agreement reached with holders of about 84.5% of the aggregate outstanding principal amount of the senior debt claims.

Under the plan, the company’s $391.23 million of existing 5 1/8% notes due 2033 and $17.5 million of debt under a letter-of-credit facility with Citibank, NA as administrative agent will be exchanged for new notes to be issued under the plan.

On the plan effective date, the new issuer, the reorganized debtors, the ILAP partners and the convertible notes indenture trustee will enter into a sales facilitation agreement, through which the parties will agree to make their best efforts to sell 100% of the reorganized ILAP equity by Dec. 31, 2025.

Since the principal objective of the plan is to address the debt under the existing notes and facility, only those claims are impaired under the plan, with the interests in ILAP being technically impaired to implement the restructuring.

All other claims and interests, including all general unsecured claims and existing equity interests in the San Juan and Norvind subsidiaries, are unimpaired under the plan.

Prior to filing the Chapter 11 cases, on Wednesday, the debtors started soliciting votes to accept or reject the plan from holders of senior debt claims and equity holders.

As of Thursday, the debtors have obtained the ballot from the holder of the LoC facility claims and preliminary ballots from the consenting noteholders party to the RSA, each evidencing their support of the plan.

The plan voting deadline is 5 p.m. ET on Dec. 28.

The energy company is based in Santiago, Chile. The company filed bankruptcy on Nov. 30 under Chapter 11 case number 23-11891.

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