Momentive says court will confirm plan; intends to emerge within weeks

By Kali Hays

New York, Aug. 27 – Momentive Performance Materials Inc. said that the U.S. Bankruptcy Court for the Southern District of New York indicated it will confirm the company’s proposed restructuring plan after certain modifications have been made, according to a Wednesday news release.

Momentive intends to amend the plan and emerge from bankruptcy “within the next few weeks.”

Key terms of the plan include a $600 million rights offering, which will provide a significant equity infusion to the company and 100% recovery to trade creditors and other general unsecured creditors.

Upon emergence, Momentive will have eliminated about $3 billion of debt from its balance sheet, and will have liquidity of around $425 million and net debt of roughly $1.2 billion, according to the release.

“Our restructured balance sheet better aligns MPM with current industry dynamics and will provide us with additional cash flow that, among other things, can be invested in growth opportunities, research and development and technology enhancements,” Craig O. Morrison, Momentive’s chairman, president and CEO, said.

Momentive, a silicones and advanced materials company based in Albany, N.Y., filed for bankruptcy on April 13 in the U.S. Bankruptcy Court for the Southern District of New York. The Chapter 11 case number is 14-22503.

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