Foley Attorneys Publish on Restructuring Options for Distressed Energy Companies

Foley & Lardner LLP partners Nick Peters, Thomas Scannell, and Zachary Zahn co-authored the Hart Energy article, “Restructuring Options: What to Do When Downcycles Strike,” exploring corporate restructuring as a strategic pathway for distressed energy companies.

The authors highlight how corporate restructures, particularly Chapter 11 bankruptcies, can help energy companies right-size balance sheets, improving financial health and mitigating liabilities.

For distressed energy companies considering a corporate restructure, the authors point to the value in developing a preliminary action plan, enlisting the support of experienced professionals and service providers, and ensuring the restructuring team put together is familiar with the energy industry.

“Executives shudder at the thought of restructuring or filing for bankruptcy due to an ill-placed stigma and concerns over associated costs,” the authors conclude. “But if done in a timely manner and correctly, restructuring can save underperforming businesses, reduce or eliminate liabilities, and improve liquidity through contract renegotiations or asset sales — allowing unhealthy companies to live to fight another day in less-distressed times.”