Bankruptcy News

We've summarized the latest docket activity and news for publicly traded companies currently operating under U.S. Bankruptcy Court protection.

Bankruptcy/Chapter 11 / Energy

American Natural Energy Plan Filed

American Natural Energy (ANEC) filed with the U.S. Bankruptcy Court a Chapter 11 Plan of Reorganization and related Disclosure Statement. According to the Disclosure Statement, "The holders of Class 1 priority Claims of $106,032.27 will be paid in full as soon as practicable on or after the Closing. Class 1 is unimpaired and deemed to accept the Joint Plan….Secured Claim of Hillair is temporarily allowed at $3,500,000 for solely purposes of implementing the bidding procedures. If Hillair acquires the New Equity Interests without a need for an Auction, then there is no need to determine the full amount of the Claim. However, if Hillair is not the successful bidder in an Auction, it reserves its right to assert its full Claim in the approximate amount of $4,091,000 subject to all parties rights to object to same….If an Auction occurs, the holder of the Class 2 Secured Claim will serve as the Stalking Horse. Its Bid will be equal to $5,100,000 composed of the temporarily Allowed amount of its Class 2 Secured Claim of $3,500,000, plus the Proposed Dip Loan Balance and Cash equal to $1,600,000. If no competitive bid is made pursuant to the Court-approved Bid Procedures, Hillair will consummate the Equity Acquisition Transaction. If an Auction occurs and a cash offer of no less than $5,225,000 is made, Class 2 may either participate in competitive bidding by increasing the Cash necessary to be party to the Equity Acquisition Transaction or may elect to not exercise its rights to participate beyond its Stalking Horse Bid. Class 3 Lien Claims, as ultimately determined in the Lawsuit, will receive either payment in full or a pro rata distribution of the Excess, which is the Cash realized from the Equity Acquisition Transaction or sale of Assets, remaining after the payment or reserve for Administrative Claims and Priority Claims in the event that Hillair is the Successful Bidder. In the event that another bidder is successful, then the holders of Class 3 Claims will be paid in full. Allowed Class 4 Claims of $9,489,992.13 will receive a pro rata distribution of any portion of the Excess, which is the Cash realized from the Equity Acquisition Transaction or sale of Assets, over and above the amounts necessary to satisfy Administrative Claims, Priority Claims, Class 2, and Class 3 Claims….Subordinated Claims Class of Gothic Resources of $9,336,516 is composed of Debtor's affiliate and subsidiary holding the largest unsecured claim."

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Amazon = US GDP 1970

Amazon joined Apple in reaching a $1 trillion market capitalization. $1 trillion is about the same as the total value of New York City property and the total value of loans at JP Morgan, the nation’s largest bank in terms of assets. Jeff Bezos’ $160 billion stake would place him (personally) as the #33 largest company in the S&P 500 in terms of market cap, next to Coca-Cola, Disney and Netflix. We aren’t bold enough to predict whether the shares will continue upwards or if they are in a bubble reaching maximum inflation. Setting aside for a moment their investment prospects, let’s admire the truly remarkable milestone that these two companies have reached. Read More.

EV/EBITDA: What Is It & Why Are We Using It More?

In reading recent editions of The Turnaround Letter, you have probably noticed that we are increasingly using EV/EBITDA as a valuation measure, rather than the better-known price/earnings multiple.  We thought it might be useful to describe this measure and why we like it.

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Turnaround Letter Stock Pick Named Top Performer of 2017

 

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What Last Year's Top Stock Pickers Are Buying in 2018

 

This Forbes write-up follows up on the recent Top Stock Tips report--naming The Turnaround Letter's Crocs recommendation the top performer of 2017: With 90% gains, CROX beat out 100 other investment ideas included in the report; and the stock continues to have value investing appeal, according to Putnam.

 

George notes, "We see additional upside for the stock in 2018 as management's efforts continue to bear fruit, though the gains will likely be more muted than we saw in 2017."