Milbank, Tweed, Hadley & McCloy LLP represented the Ad Hoc Committee of Senior Noteholders of Vanguard Natural Resources LLC in connection with the company’s restructuring supported by each of Vanguard's key creditor constituencies.
Vanguard Natural Resources, an independent oil and gas company, voluntarily sought chapter 11 protection on February 2, 2017 in the US Bankruptcy Court for the Southern District of Texas. As of the commencement of its chapter 11 case, the company listed total assets of $1.54 billion and total debt of $2.3 billion.
Vanguard’s reorganization plan was confirmed on July 18, 2017 and the company emerged from bankruptcy shortly thereafter on August 1, 2017 as a new corporation under the name of Vanguard Natural Resources, Inc. As part of Vanguard's confirmed chapter 11 plan, Senior Noteholders agreed to backstop a $250 million rights offering, purchase $30.25 million in New First Lien Term Loans, and will receive 97% of the equity in reorganized Vanguard.
Milbank attorneys took a leading role in (i) negotiating and defending the Restructuring Support Agreement entered into by a majority of Vanguard’s Senior Noteholders, Second Lien Noteholders, and First Lien RBL Lenders, (ii) resolving the objections of the Official Committee of Unsecured Creditors, the Ad Hoc Equity Holders’ Committee, and Encana USA to the plan and restructuring and (iii) structuring the reorganization in a tax-efficient manner for both Vanguard’s current equity and its future owners.
Vanguard emerges from Chapter 11 with approximately $820 million of secured and unsecured debt eliminated from its balance sheet and its financial flexibility significantly enhanced.
The Milbank team was led by Financial Restructuring partners Dennis Dunne and Samuel Khalil. Also advising the Ad Hoc Committee were partners Manan Shah (Executive Compensation and Employee Benefits), Scott Golenbock (Corporate), Andrew Leblanc (Litigation and Financial Restructuring), Albert Pisa (Alternative Investments), and Russell Kestenbaum (Tax), Stuart Morrissy (Capital Markets); and special counsel Brian Kinney (Financial Restructuring), Sam Badawi (Capital Markets), Nicholas Bassett (Litigation), and Jennifer Harris (Alternative Investments).
