From Houston Business Journal:
Houston-based Linn Energy Inc. announced Feb. 28 it has emerged from Chapter 11 bankruptcy as the reorganized successor to Linn Energy LLC.
As part of the reorganization, Linn and Berry Petroleum now operate as standalone companies in an effort to simplify the companies’ structures. Linn is moving from an upstream master limited partnership to a growth-oriented exploration and production company, according to the company’s board of directors.
Linn, Berry and about a dozen other affiliated entities filed for bankruptcy protection in May, listing total debts of nearly $8.28 billion and total assets of more than $11.61 billion. That was the most debt of any upstream energy company that had filed for bankruptcy in North America so far in 2016, according to data from Haynes & Boone at the time.
Linn has since reduced its debt by more than $5 billion to total debt of more than $1.01 billion and pro forma net debt of $962 million, according to a press release. Kirkland & Ellis LLP served as legal adviser to Linn in the bankruptcy process, Lazard served as financial adviser, and AlixPartners served as restructuring adviser.
Additionally, the board of directors hired Jefferies LLC as lead adviser to explore and evaluate potential strategic alternatives, including selling five non-core assets. Any proceeds would go toward paying down Linn’s balance sheet and allow the company to focus resources elsewhere. The following companies are marketing the following assets:
- RBC Richardson Barr will market the Williston and Permian packages.
- CIBC Griffis & Small will market the South Texas and Salt Creek packages.
- Tudor Pickering, Holt & Co. will market California.
Currently, one of the core areas of Linn’s portfolio is the SCOOP/STACK/Merge onshore play, where the company has about 185,000 net acres. SCOOP stands for “South Central Oklahoma Oil Province,” while STACK represents the “Sooner Trend (oil field), Anadarko (basin), Canadian and Kingfisher (counties).” Some major asset sales over the past year have involved the SCOOP/STACK area, such as an $888 million deal from Houston-based Marathon Oil Corp. (NYSE: MRO).
“Today marks a new beginning for our company and all of our stakeholders,” Linn President and CEO Mark Ellis said in a press release. “With significantly less debt and an infusion of new equity capital, we have ample liquidity to accelerate growth in our core areas, including our SCOOP/STACK/Merge position. We are confident that our diverse and high-quality asset base will serve as a foundation for our future success.”
Also on Feb. 28, Linn announced its board of directors now consists of:
- Mark Ellis, president and CEO of Linn
- David Rottino, executive vice president and CFO of Linn
- Matthew Bonanno, partner at York Capital Management
- Phil Brown, partner at P. Schoenfeld Asset Management
- Evan Lederman, managing director and partner at Fir Tree Partners
- Kevin Mahony, principal at Centerbridge Partners
- Andy Taylor, member of the investment team of Elliot Management Corp.
