GSE Environmental emerges from bankruptcy, Chapter 11 plan effective

By Caroline Salls

Pittsburgh, Aug. 11 – GSE Environmental, Inc. emerged from the Chapter 11 process after its plan of reorganization took effect on Monday, according to a company news release.

The company said it exited the restructuring process with a significantly reduced debt load, meaningfully enhanced liquidity and the support of new owners Littlejohn & Co., LLC and Strategic Value Partners.

“Today marks a fresh start for GSE,” chief executive officer Chuck Sorrentino said in the release.

“Our new capital structure and substantially stronger balance sheet helps position our company for long-term growth and profitability.

“Our global footprint, portfolio of innovative products and attractive end markets contribute to our optimistic outlook for the future.”

GSE said its board of directors will be controlled by Littlejohn & Co.

As previously reported, the plan, which is based on a restructuring agreement with lenders, was confirmed by the U.S. Bankruptcy Court for the District of Delaware on July 25.

Under the agreement, GSE will restructure its balance sheet by converting all of its outstanding first-lien debt to equity.

Treatment of creditors under the plan of reorganization will include the following:

• Administrative expense claims, including debtor-in-possession financing claims, and pre-bankruptcy priority claims will be paid in full;

• Holders of first-lien credit agreement claims will receive their share of 100% of the equity of reorganized GSE Holding, Inc.;

• Other secured claims will be rendered unimpaired;

• Holders of trade vendor claims that agree in writing to return to market trade terms for at least a year following the Chapter 11 cases will be paid in full to the extent not previously satisfied;

• Other holders of general unsecured claims will receive their share of $1 million of cash; and

• Existing equity interests in GSE Holding will be canceled without any distribution to holders.

GSE, a Houston-based plastics company, filed bankruptcy on May 4. The Chapter 11 case number is 14-11126.

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