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Sheridan Holding files bankruptcy in wake of lower oil, gas prices
By Sarah Lizee
Olympia, Wash., March 23 – Sheridan Holding Co. I, LLC filed Chapter 11 bankruptcy on Monday in the U.S. Bankruptcy Court in the Southern District of Texas to implement a restructuring through a pre-packaged plan of reorganization.
The company said that decreasing oil and gas prices have resulted in diminished performance and value of their investment properties.
According to the disclosure statement, the plan contemplates equitization of Sheridan’s secured debt, a take-back exit facility, and a conditional distribution of the new warrants to limited partners.
Specifically, the plan would reduce prepetition debt by about $470 million and refinance the remainder of the debtors’ secured debt with a $150 million exit facility.
The reorganized debtors will seek bids for the sale of some asset packages to facilitate a winddown of the debtors’ assets.
Under the plan, holders of administrative claims and other priority claims will receive payment in full in cash.
Revolving lenders and term lenders will receive new term loans under the exit facility, new Sheridan equity and excess balance sheet cash, if any.
General unsecured claims will be reinstated or otherwise receive payment in full in cash.
The company has $100 million in assets and $616 million in liabilities. The debt consists of three first-lien revolving credit facilities with about $167.1 million outstanding and three first-lien term loan credit facilities with about $449 million outstanding.
The debtors are represented by Matthew D. Cavenaugh of Jackson Walker LLP. Kirkland & Ellis is acting as general bankruptcy counsel, Alix Partners LLP is acting as financial adviser, Evercore is acting as investment banker and Prime Clerk is acting as claims agent.
A confirmation hearing is set for March 24.
Sheridan Production Partners is an oil and gas company based in Houston. The Chapter 11 case number is 20-31884.
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