Mayer Brown advises on $1.2bn oil and gas restructuring

Mayer Brown is advising on the $1.2bn restructuring and $133m sale of ATP Oil & Gas UK to Alpha Petroleum, the UK subsidiary of private equity house Petroleum Equity.

The firm has been advising the bankrupt US outfit ATP Corporation on Chapter 11 proceedings in the US since 2012.

Mayer Brown won the ATP UK deal through its work in the US . It has proved a tricky sale as creditors are set to receive only a tenth of the amount they put in to the debt-laden company.

Global energy co-head Rob Hamill and London restructuring, bankruptcy and insolvency head Devi Shah are leading a 10-strong international team on the deal, which includes  corporate senior associate Beccy Bothamley, associate Jonny Musker and restructuring and insolvency of counsel Alex Wood in London.

They are joined by London bankruptcy senior associates Jessica Walker, Ronan McNabb and associate Henry Glen. The firm is also fielding a Houston team made up of corporate partner Bob Gray and litigation partner Charles Kelley, and restructuring and bankruptcy associate Christine Walsh in New York.

Alpha is advised by a hefty roster of lawyers including Herbert Smith Freehills’ partner Laurence Elliott on UK insolvency advice, Scottish firm Stronachs partner Ewan Neilson on UK M&A and  Debevoise & Plimpton lawyers in the US and UK.

Debevoise is advising the company on US bankruptcy issues, led by partner Natasha Labovitz, and is fielding a London team to led by partner Geoffrey Kittredge including tax partners Matthew Saronson, Richard Ward, and associate Kenneth Barry.

Mayer Brown has had to engage in complex negotiations to sell ATP, which had built up debts of $1.2bn. In order to  satisfy the UK company’s shareholders and Alpha with the $133m sale price, the company first had to strike a restructuring deal and secure a company voluntary agreement (CVA).

The CVA was cemented on the 10 January and is expected to complete next month.

Mayer Brown partner Shah 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.”

The sale of the business will not hand any cash to the US ATP, which had already cast off its UK subsidiary. The business filed for bankruptcy in the ace of falling production and a looming $89m interest payment.