Arsenal Resources Development pre-packaged Chapter 11 plan confirmed

By Caroline Salls

Pittsburgh, Dec. 19 – Arsenal Resources Development LLC’s first amended pre-packaged Chapter 11 plan was confirmed on Thursday by the U.S. Bankruptcy Court for the District of Delaware.

As previously reported, Arsenal filed bankruptcy to implement a recapitalization transaction that includes a $100 million new equity investment made by funds affiliated with Chambers Energy Capital and Mercuria Energy Co. and a deleveraging of the company’s balance sheet.

When the plan takes effect, the recapitalized company will be majority-owned by funds affiliated with Chambers and by Mercuria.

In addition to the $100 million equity investment, Arsenal said syndicated lenders have agreed to equitize more than $360 million of long-term debt. Upon completion of the transaction, the recapitalized company is projected to have a new $130 million RBL facility and no other funded debt.

The plan calls for employees, customers and vendors of Arsenal’s operating subsidiaries to be paid in full in the ordinary course of business.

General unsecured claims and DIP financing claims will be paid in full.

Holders of existing equity interests will receive no distribution.

Arsenal is a Pittsburgh-based independent exploration and production company. The company filed bankruptcy on Nov. 8 under Chapter 11 case number 19-12347.

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