Emerge Energy committee opposes extension, cites lack of negotiations

By Caroline Salls

Pittsburgh, Nov. 22 – Emerge Energy Services LP’s official committee of unsecured creditors objected to the company’s proposed exclusivity extension in a Thursday filing with the U.S. Bankruptcy Court for the District of Delaware.

The committee said Emerge Energy’s extension request was based on its progress in its Chapter 11 cases, including negotiations and regular communication with credit constituencies.

“These statements must be holdovers from other standard exclusivity extension motions from typical cases (where debtors and creditor constituencies do negotiate) because they certainly could not have been meant to describe these Chapter 11 cases,” the objection said.

Since it filed for bankruptcy, the creditor group said Emerge Energy has not held plan negotiations with the committee, “a constituency that represents potentially over $570 million in unsecured claims against the debtors.”

Instead, the committee said it has attempted to negotiate with the company and other constituencies, but its “proposals have been met with deafening silence.”

“If, as the committee hopes, the court denies the deeply flawed plan, the motion should be denied so that the committee can explore other alternatives (including a sale) rather than being undoubtedly offered more crumbs in the next ill-fated plan attempt,” the objection said.

If the company’s plan is confirmed, the committee said its objection will be moot.

Southlake, Tex.-based Emerge Energy Services is a limited partnership formed in 2012 by management and affiliates of Insight Equity Management Co. LLC to own, operate, acquire and develop a portfolio of energy service assets. The company filed for bankruptcy on July 15 under Chapter 11 case number 19-11563.

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