The U.S. Bankruptcy Court for the Southern District of Texas confirmed on January 25, 2020 Speeedcast and certain of its affiliates’ Plan of Reorganisation. This comes 9 months after Speedcast first announced its decision to recapitalise its business through voluntary Chapter 11 proceedings on April 23, 2020.
The confirmation definitively clears the path for Speedcast to successfully complete the Chapter 11 process after receiving final regulatory approvals and satisfying customary closing conditions, which is expected by the end of the first quarter of 2021. The company is poised to emerge with a significantly strengthened balance sheet and the support of Centerbridge Partners, L.P. and its affiliates as its new owner.
“The Court’s confirmation of the Plan marks a key milestone in the Company’s efforts to become a stronger business and positions us to emerge in the near term, having achieved our goals,” said Stephe Wilks, chair of Speedcast. “Throughout the restructuring process, the Company’s global workforce has delivered on its commitments while adapting to change. On behalf of the Board, we are immensely grateful for the ongoing patience and trust that the Company’s employees, customers and partners have shown in this process.”
Joe Spytek will take on the role of Speedcast’s chief executive officer, leading the company upon emergence under the new Centerbridge ownership. Spytek has served as Speedcast’s president and chief commercial officer for the last year after being tapped to join the organisation to help implement its turnaround.
“With a bolstered financial foundation and with the support of Centerbridge, one of the world’s leading investment funds, Speedcast is well-positioned to maximize its full potential as the Company works to build a platform that addresses customers’ most demanding operations and application requirements now, and in the future,” saidMr Spytek. “Looking ahead, this agility and commitment to innovation will continue as Speedcast keeps raising the bar for itself and the industry as a whole.”
“Speedcast’s best-in-class technology and connectivity solutions provide a leading value proposition to the Company’s customers, enhancing productivity, communication and safety,” said Jared Hendricks, senior managing director, Centerbridge. “We continue to be excited about investing behind Joe and the Speedcast team’s innovation and support of its customers and partners in the next phase of growth for the Company.”
The Plan also provides for, among other things, a cash payment to holders of secured claims and cash payment to certain of Speedcast’s critical trade vendors. Unsecured creditors will share in recoveries from a litigation trust. The Plan does not contemplate any recovery for existing shareholders, who will no longer have an equity interest in the reorganised Company following its emergence.