Penn Virginia expects to emerge from bankruptcy by summer’s end
May 12 (Reuters) – Oil and natural gas producer Penn Virginia Corp said on Thursday it had filed for bankruptcy protection, the latest company to fall victim to the oil price rout.
Dozens of U.S. shale companies have sought bankruptcy protection in recent months as a near-60 percent slump in oil prices since mid-2014 erodes cash flows.
This has forced companies to restructure debt taken on during a frenzy of development in recent years.
Penn Virginia said its restructuring was supported by 86 percent of its senior noteholders and all of its bank lenders, and would reduce its long-term debt by more than $1 billion.
As of March 31, the company had total debt of $1.22 billion, according to a regulatory filing.
Penn Virginia said it expected to emerge from bankruptcy protection by the end of the summer.
The company said it expected to receive $25 million in debtor-in-possession financing subject to court approval.
Penn Virginia said it had also received a commitment for up to $128 million in exit financing and a $50 million rights offering that is backed by some senior unsecured noteholders.
The Wayne, Pennsylvania-based company operates mainly in the Eagle Ford shale formation in South Texas.
Linn Energy LLC filed for Chapter 11 bankruptcy on Wednesday, while Sandridge Energy Inc said it would not file its quarterly results on time.
Sandridge has been in talks with its creditors on a restructuring deal ahead of a potential bankruptcy.
(Reporting by Swetha Gopinath and Anet Josline Pinto in Bengaluru; Editing by Maju Samuel)