Molycorp Files For Chapter 11 Bankruptcy, Inks Restructuring Deal With Creditors

(RTTNews) - A day after mining company Molycorp, Inc. (MCP) announced the postponement of its 2015 annual meetings of stockholders, the company and its North American subsidiaries filed voluntary petitions under Chapter 11 of the Bankruptcy Code in U.S. Bankruptcy Court for the District of Delaware in order to facilitate its financial restructuring.

The company's non-operating companies in Luxembourg and Barbados, along with Molycorp Rare Metals (Oklahoma), LLC, are excluded from the filings.

The company also said its has signed a restructuring support agreement with key creditors, covering more than 70 percent of its aggregate principal amount of 10% senior secured notes.

Greenwood Village, Colorado-based rare earths company added that the agreement provides for a financial restructuring of its $1.7 billion in debt. It also provides up to $225 million in gross proceeds of debtor-in-possession (DIP) financing to support operations while it completes negotiations with creditors.

The DIP commitment has been obtained from a group of its 10% senior secured noteholders, led by JHL Capital Group, JMB Capital Partners and QVT Financial LP.

As part of the filings, the company filed a restructuring plan term sheet that broadly outlines the terms of the plan of reorganization that it expects to pursue.

As part of the Chapter 11 filing, Molycorp expects to receive notice from the NYSE informing it that its shares will be delisted from the NYSE within nine calendar days of notification, with the shares ecpected to be traded on the OTC Pink Sheets exchange following that.