Chesapeake Energy Corp., the second-biggest gas producer within the U.S., said Monday it “has no offers to pursue bankruptcy” performing a report that it had hired restructuring lawyers sent the business’s stock price down so violently it triggered several halts.
The Oklahoma City shale driller’s stock price fell greater than 50 percent after U.S. debt research firm Debtwire reported that Chesapeake had retained Kirkland & Ellis LLP to help restructure US$9.8 billion indebted amid the rout in oil prices. Chesapeake’s stock pared back losses after it issued a disagreement knowing that Kirkland & Ellis, which has served since its counsel since 2010, is constantly on the advise Chesapeake as “it seeks for helping strengthen its balance sheet following its recent debt exchange.”
Jittery investors pushed shares of Chesapeake 33.9 per cent lower to US$2.02 at 3:15 p.m. in Ny.
As happens with many different companies inside the energy sector, Chesapeake is facing a cash crunch that’ll be exacerbated the greater commodity prices stay at current levels.
“At current commodity prices, we believe CHK has enough liquidity through 2016, but 2017 can become much more challenging if commodity prices don’t significantly increase and/or actions to enhance the amount sheet don’t occur,” Scott Hanold, an analyst at RBC Capital Markets, wrote in the note to clients.
cpellegrini@nationalpost.com
