Release
Aventine Renewable Energy Holdings Inc. announced that it has entered into a Restructuring Agreement with 100% of its term loan lenders.
As per the terms of this agreement the company would convert the majority of its outstanding term loan debt into newly issued common equity of the company, representing, on a fully diluted basis, approximately 92.5% of the issued and outstanding common stock after the issuance.
The company said that its board of Directors unanimously approved entering into the agreement and holders of approximately 60% of its common stock have also approved the agreement. If completed, the Company expects the restructuring to reduce the Company’s existing debt by approximately $135 million and significantly lower the Company’s annual cash interest expense.
As part of the transactions, the term loan lenders have also agreed, subject to receipt of internal credit approvals, to provide $30 million in the form of additional indebtedness to further improve the Company’s liquidity.
With the commitment of all the requisite stakeholders the transactions are expected to be consummated without any court approvals. If completed, the Company expects that unsecured creditors would not be affected by the restructuring and trade creditors would continue to receive payments in the ordinary course. The transactions are targeted to close by the end of the 3rd quarter of 2012.
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