Westinghouse looks to amend facilities; non-debtor units need funds

By Caroline Salls

Pittsburgh, Oct. 12 – Westinghouse Electric Co. LLC requested court approval to amend its debtor-in-possession credit agreement and liquidity facility agreement, according to a motion filed with the U.S. Bankruptcy Court for the Southern District of New York.

“Certain of the debtors’ non-debtor subsidiaries inside and outside the U.S. require immediate funding, either to maintain operations, to make significant value enhancing investments, or to strengthen their balance sheets to avoid foreign insolvency filing requirements,” Westinghouse said in the motion.

“Under the terms of the debtors’ existing post-petition financing agreements, the debtors are unable to provide these valuable entities with much-needed financing.”

As a result, the company said it negotiated with the lenders under its existing $800 million debtor-in-possession secured financing facility to expand the size and scope of the “permitted investment baskets” already existing under the DIP facility and provide urgently needed funding to some non-debtor direct and indirect partially and wholly owned subsidiaries through transactions that are currently restricted under the terms of the DIP facility.

Westinghouse said the amendments do not require the debtors to compromise or grant concessions to the DIP lenders.

Specifically, under the proposed amendments, Toshiba Nuclear Energy Holdings (UK) Ltd. (TNEH) will be permitted to be a borrower under the liquidity facility and loans that it borrows to fund Mangiarotti SpA will not be guaranteed or cross-collateralized by other borrowers.

In addition, new investment baskets will be added to the loan documents to allow $13 million in investments in Mangiarotti, a total of $10 million in investments in Westinghouse Electric (Asia) SA, Westinghouse Electric Belgium SA (WEB) and its Astare subsidiary and $15 million in investments in Westinghouse Government Services LLC and Flour Westinghouse Liquid Waste Services, LLC.

The general investment basket and equivalent LFA investment basket will be increased to $25 million from $10 million to provide additional investment capacity for unforeseen needs.

The company said the debtors and non-debtors will also be able to reallocate unused portions of the specified investment baskets for use under other investment baskets with the written consent of the DIP lenders.

According to the motion, a negative covenant in the loan documents restricting non-ordinary course transactions with affiliates that are not on arm’s-length terms will be amended to allow some non-debtor foreign affiliates to purchase impaired accounts receivables from Astare or WEB at par.

A hearing is scheduled for Oct. 26.

Westinghouse, a Cranberry Township, Pa.-based nuclear products and services company and a subsidiary of Toshiba, filed bankruptcy on March 29, 2017. The Chapter 11 case number is 17-10751.

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