New Fortress Energy (NFE) said on Friday it had completed a restructuring that separates its Brazilian operations from the rest of the business and cuts the LNG and power producer's corporate debt by about $5 billion.
The restructuring became effective Friday after the energy firm completed all required steps and received the necessary approvals under a UK restructuring plan approved in June. A US bankruptcy court in New York also recognized the plan.
The transaction extinguished about $5.7 billion of third-party debt. Creditors received all the equity in the Brazilian business, known as BrazilCo, as well as preferred and common equity in the restructured New Fortress Energy and about $571.3 million of term loans.
Following the restructuring, New Fortress Energy's corporate debt has fallen to about $700 million from about $5.7 billion, Chief Executive Officer Wes Edens said.
The restructured company, known as New NFE, retains a portfolio of LNG and power assets, including terminals and logistics operations in Mexico and Puerto Rico, as well as a 735-megawatt power and turbine portfolio.
New NFE also secured $136.5 million of new financing on the effective date of the restructuring. Certain creditors will have an opportunity to participate in the financing.
The Brazilian business will operate as a separate entity following the transaction, while creditors also received preferred equity and term loans tied to the company's FLNG 2 assets.
Edens said the simplified balance sheet and reduced leverage would allow New NFE to focus on deploying its existing assets and expanding its LNG portfolio.
The company expects its assets to generate significant cash flow as projects are fully deployed in the coming months, he said.
New Fortress Energy has been working to reduce its heavy debt burden as it stabilizes its business and focuses on LNG infrastructure and power generation.
The restructuring gives the energy firm a smaller corporate debt load while leaving it with operations across Mexico, Puerto Rico and other markets.