Daily News: January 21, 2014

Mayer Brown Advises on $1.2B ATP Restructuring and Sale

Mayer Brown announced it advised on the restructuring and sale of ATP Oil & Gas (UK) to Alpha Petroleum (UK) Holdings, an investment vehicle of Petroleum Equity and newly established private equity firm focused on the upstream oil and gas market outside North America.

ATP UK has interests in a total of six producing and development offshore oil and gas fields (comprising 12 licences) in the UK North Sea and acts as a DECC approved Regulated Operator. ATP UK’s parent company, ATP Oil & Gas Corp., is currently in Chapter 11 insolvency process in the United States. The sale was approved by the U.S. Bankruptcy Court on December 19, 2013.

The transaction is being implemented through the sale of the shares of ATP UK combined with a company voluntary arrangement, with a sale value of $133 million. The company voluntary arrangement, which is designed to compromise legacy unsecured liabilities of $1.2 billion, was approved by creditors and shareholders on January 10, 2014. Completion of the transaction is expected at the beginning of February 2014.

Rob Hamill, co-head of Mayer Brown’s global Energy group, said, “This has been a lengthy, complex but highly rewarding transaction. The combination of the dedicated, experienced management team from ATP UK with Petroleum Equity has the potential to create a real force in the UK North Sea. The transaction is also further evidence of the growing importance of private funding in the oil & gas industry.”

Devi Shah, co-head of Mayer Brown’s Restructuring, Bankruptcy and Insolvency group in London, said, “Standalone CVAs as a restructuring tool are a rare animal and very challenging to pull off, even without having the US bankruptcy court approval process to go through as well, but this was absolutely the right solution for ATP UK. The implementation of the CVA and completion of the sale will effect a genuine turnaround for the company, saving jobs and securing its future, as well as a better outcome for its creditors than any of the alternatives it faced.”

The Mayer Brown team was led by Rob Hamill, co-head of the global Energy group and Devi Shah, co-head of the Restructuring, Bankruptcy and Insolvency group in London. They were assisted by Corporate & Securities senior associate Beccy Bothamley and associate Jonny Musker; Restructuring, Bankruptcy and Insolvency of Counsel Alex Wood, senior associates Jessica Walker and Ronan McNabb and associate Henry Glen (all London). Corporate & Securities partner Bob Gray and Litigation partner Charles Kelley (both Houston) and Restructuring, Bankruptcy and Insolvency associate Christine Walsh (New York) led on U.S. matters including the Bankruptcy Court approval process.