Bonanza Creek Energy said Friday the U.S. Bankruptcy Court in Delaware approved its restructuring plan, allowing it to exit from bankruptcy protection by the end of the month.
The Denver-based oil and gas producer reached an agreement with a majority of its creditors and filed for bankruptcy last year. But a group of dissenting shareholders cried foul, and Bonanza Creek had to go back and craft a deal to win them over.
The dissenting shareholders will be allowed to contribute $7.5 million within a $200 million rights offering, giving them a 1.75 percent stake in the company. Bonanza Creek also agree to pay up to $3 million in shareholder legal fees related to their protest.
The original plan, which the company said has unanimous support from unsecured creditors, converts $867 million in unsecured debt into equity and eliminates $50 million in annual interest payments. It also provides for $200 million in fresh capital to the company, whose operations are concentrated in the Wattenberg Field northeast of Denver, and in southeastern Arkansas.
Apollo Energy Opportunity Management, D.E. Shaw Galvanic Portfolios and Oaktree Capital Management are the noteholders who will take over the company.
