U.S. Gen New England
BACKGROUND
- USGen New England, diversified fossil fuel and hydroelectric power generation company in MA, RI, NH and VT, which filed for Chapter 11 in July 2003 primarily as a result of the downturn in the energy sector.
- As part of its restructuring and reorganization efforts, the Company was pursuing sale and stand-alone alternatives.
- CDG retained as full scope financial advisor (restructuring, operations, valuation, litigation support and M+A) to the Restricted Noteholders who provided the debt financing for the Bear Swamp Facility.
- Amongst other things, the Company sought to reject its "lease" of the Bear Swamp Pumped Storage Hydroelectric Facility and the run of the river Fife Brook station, which had been financed through a $480 million "sale/leaseback" transaction by the way of a tax-based, leveraged "lease".
- The characterization of the financing ("lease" versus financing) of the Bear Swamp Facility was the subject of complex litigation.
- Conducted extensive due diligence and financial and operating analyses to advise the Noteholders on their recovery strategies.
- Led the negotiation and implementation of interim operating agreements resulting in the preservation of both cash flow and optionality for the Noteholders.
- Critiqued the Company’s proposed sales of assets.
- Marketed the Bear Swamp Facility with respect to its lease, operation or aquisition so that all of the strategic alternatives available could be evaluated by the Noteholders.
- Performed valuation analysis and advised on the sale of the Facility for $92 million to Brascan and Emera.
- Negotiated a change to the operator of the Facility and advised on the annual maintenance outage.
- Led the negotiation of a settlement of the "lease" versus financing litigation with all parties in interest, which resulted in a POR whereby the allowed claims of all creditors were paid in full with 4% p.a. post-petition interest.