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A U.S. chapter courtroom set a Sept. 22 bid deadline to buy property of a Texas-based metals recycling firm that has $293.6 million of income bonds excellent.
Aleon Metals, LLC and its two subsidiaries filed Chapter 11 petitions within the Southern District of Texas Courtroom final month with the purpose of promoting most of their property within the wake of monetary troubles that led to bond defaults.
The subsidiaries — Aleon Renewable Metals (ARM) and Gladieux Metals Recycling (GMR) — bought a complete of $313.5 million of tax-exempt non-rated strong waste disposal services income bonds via the Brazoria County Industrial Growth Corp.
The Chapter 11 instances have been consolidated for procedural functions by a decide, who additionally permitted debtor-in-possession (DIP) financing offered by sure bondholders forward of the asset sale, in keeping with
“The debtors’ obligations beneath the DIP facility and associated paperwork are secured by a primary precedence senior safety curiosity in and lien upon considerably all property and property of the debtors in favor of the DIP lenders to repay the DIP loans,” the notices stated.
GMR bought three sequence of senior income bonds totaling $100 million in 2019 and $38.5 million of subordinated bonds in a single 2020 sequence. Income bonds bought by ARM totaled $75 million in 2022 and $100 million in 2023.
In a courtroom submitting, Roy Gallagher, the debtors’ chief restructuring officer, outlined occasions main as much as chapter, together with a malfunction in a sulfur dioxide scrubber that led to materially decreased manufacturing, metals worth volatility, and unavailable capital funding from fairness holders.
“The debtors, their advisors, their lenders, and different stakeholders all consider that commencing these Chapter 11 instances will present the perfect alternative to stabilize operations, implement a value-maximizing sale course of and deal with legacy liabilities in an orderly and clear method,” in keeping with the submitting, which listed $403.2 million in whole excellent debt, together with the income bonds.
The Freeport, Texas-based firms’ property embrace a facility bought in 2017 specializing in extracting useful metals from waste generated by oil refineries.
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