Aegean Marine Petroleum Network Inc. has filed for Chapter 11 bankruptcy protection, with strategic backing from its partner Mercuria Energy Group. The filing aims to address financial challenges and restructuring needs.
Financial Support and Strategy
- Post-Petition Financing: Mercuria Energy Group has committed over $532 million in post-petition financing to support Aegean Marine’s Chapter 11 process and working capital needs. Mercuria will also act as the lead bidder, or ‘stalking horse’ bidder, in the sale of Aegean’s assets, providing a foundational bid to set the terms for potential asset sales.
- Operational Continuity: Aegean Marine will continue to operate as a ‘debtor-in-possession,’ meaning it will manage its business operations while under bankruptcy court jurisdiction, adhering to the US Bankruptcy Code and court orders.
Legal and Advisory Support
- Legal Counsel: Kirkland & Ellis LLP is serving as Aegean’s legal counsel during the bankruptcy proceedings.
- Investment Banking: Moelis & Company LLC is acting as Aegean’s investment banker.
- Restructuring Advisory: EY Turnaround Management Services LLC is providing restructuring advisory services.
Recent Developments
- Fraud Investigation: A recent audit committee investigation uncovered a possible fraud involving up to $300 million in misappropriated cash and assets. The fraudulent activities involved over a dozen Aegean employees, including senior management members. Additionally, the company had approximately $200 million in accounts receivable linked to fraudulent transactions with shell companies to conceal these activities.
Implications and Next Steps
The bankruptcy filing, supported by Mercuria’s substantial financing, positions Aegean Marine to restructure its operations and address the fraudulent activities that have significantly impacted its financial stability. The ongoing court process will oversee the company’s efforts to reorganize and ultimately emerge from bankruptcy with a more solid financial foundation.
The outcome of the asset sale and restructuring efforts will be crucial for Aegean Marine as it navigates through this challenging period and works to restore its operational integrity and financial health.
