On March 14, 2018, EV Energy Partners, L.P. and its subsidiaries announced that the Company entered into a restructuring support agreement with certain holders of approximately 70% of its 8% senior notes due 2019 and lenders holding approximately 94% of the principal amount outstanding under the Company’s reserve-based lending facility on March 13, 2018. The RSA contemplates a comprehensive restructuring of the Company’s capital structure, to be implemented through a proposed pre-packaged plan of reorganization that will significantly deleverage the Company’s balance sheet. Consistent with the RSA, the Company will commence the solicitation of votes to accept or reject the Plan and commence its prepackaged bankruptcy case in the U.S. Bankruptcy Court for the District of Delaware on or before April 8, 2018.
On March 15, 2018, Moody’s Investors Service downgraded the corporate family rating of EV Energy Partners, L.P. to Caa3 from Caa2, its probability of default rating to Ca-PD from Caa2-PD and its senior unsecured notes rating to Ca from Caa3 following the Company’s announcement that it has entered into a restructuring support agreement with 70% of holders of its $343 million 8% notes due 2019 and lenders holding approximately 94% of the principal amount outstanding under the Company’s reserve-based lending facility. According to Moody’s, the downgrade reflects expectations of significant loss to the existing bondholders based on the proposed restructuring transaction. Read more on distressed companies.
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