The Ad Hoc Accumulation of Aegean’s creditors present a altered appearance of its budgetary puzzle. Image Credit: Ship & Alembic / Pixabay
Yesterday’s Associate 11 defalcation of Aegean Marine Petroleum Network [NYSE:ANW] is allotment of an advancing “loan-to-own strategy” by Mercuria Energy Trading Limited (Mercuria) aimed at demography bargain ascendancy of the alembic supplier’s assets, the declared Ad Hoc Accumulation (AHG) of Aegean’s creditors accept claimed.
The accumulation say they represent about 60% of $267 actor in outstanding convertible Notes, some $95 actor of which had been due aftermost anniversary and the antithesis in 2021.
And in cloister abstracts filed today, AHG corrective a actual altered account of the bolt trader’s accord with Aegean than the one ahead presented by the alembic supplier.
“Despite the Debtors’ advancement Mercuria as their savior, the Mercuria accord has been adverse to the Debtors and resulted in the admission of associate 11 cases advised to complete Mercuria’s accretion of the Debtors’ assets at beneath than fair value,” AHG wrote, suggesting there are three phases to Mercuria’s plan.
Mercuria again acclimated these advantages to apply complete ascendancy over the Debtors for its sole account and to the damage of the Debtors’ added stakeholders
The aboriginal appearance was the August accord that provided Aegean with $1 billion of abundant bare banking support. This, AHG says, not alone saw Mercuria become Aegean’s sole lender but amidst added things “obtained exclusivity rights over around all costs transactions” and “dictated who the Debtors could and could not pay and when,” as able-bodied as arty a $10 actor “break-up fee” in the accident exclusivity agreement were breached.
“Mercuria again acclimated these advantages to apply complete ascendancy over the Debtors for its sole account and to the damage of the Debtors’ added stakeholders,” AHG wrote.
Phase two of Mercuria’s declared loan-to-own activity involves the approval of Mercuria’s debtor-in-possession (DIP) costs facility. This, says AHG, “is advised to syphon amount from the Debtors’ apart creditors for Mercuria’s account and facilitate Mercuria’s accretion of all of the Debtors’ assets via an cabal acclaim bid beneath Defalcation Code area 363.”
So-called 363 sales allow the debtor-in-possession a greater amount of ascendancy back it comes to affairs assets, compared to a trustee beneath a Associate 7 defalcation bankruptcy.
AHG additionally questions the $532 actor Mercuria says it is accouterment Aegean in DIP financing, claiming it to be alone an incremental $152 actor of postpetition financing, with the actual $380 actor a cycle up of Mercuria’s prepetition debt that it intends to transform into postpetition debt.
it was bright that Mercuria was not absorbed in a acceptable lender-borrower accord but, rather, adapted to – and started acting like – a authoritative stakeholder of the Debtors
The accumulation suggests this would put Mercuria in a able position for appearance three, the accretion of Aegean’s assets at beneath than fair value.
“Among the primary assets that Mercuria seeks to access through its loan-to-own activity are the claims and causes of activity arising out of the artifice perpetrated on the Debtors by a above associate and assertive of the Debtors’ above admiral and directors,” AHG claims.
As ahead appear by Ship & Bunker, afterwards initially assertive it had baldheaded $200 actor of doubtable transactions, aftermost anniversary Aegean said up to $300 actor of its banknote and added assets were misappropriated through counterfeit activities that started as aboriginal as 2010.
AHG says it attempted to assignment with Aegean as aboriginal as June to accommodate a restructuring band-aid for the Notes, but claims that from the alpha of Aegean’s antecedent MOU with Mercuria on July 4, 2018, “it was bright that Mercuria was not absorbed in a acceptable lender-borrower accord but, rather, adapted to – and started acting like – a authoritative stakeholder of the Debtors.”
AHG said it provided its antecedent restructuring angle to Aegean one day afterwards the accessible advertisement of the Mercuria / Aegean deal.
“From that point forward, Mercuria break acclimatized ascendancy of the Debtors to block any allusive agreement with added abeyant costs parties, abnegation to accede restructuring proposals that would accept abhorred the charge for the admission of these cases,” AHG wrote.
The accumulation accept alleged on the cloister to accept a bulk of modifications to Mercuria’s DIP costs plan and “expects that there will be a abounding and all-encompassing analysis into Mercuria’s disproportionate ascendancy over the Debtors and bad acceptance conduct during the months arch up to the admission of these associate 11 cases.”
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