NON-OPERATING ARCAPITA SUBSIDIARY JOINS U.S. RESTRUCTURING
Manama, April 30, 2012 – Arcapita Bank B.S.C.(c) (“Arcapita”), the international investment firm headquartered in Bahrain, announced today that one of its non-operating subsidiaries, Falcon Gas Storage Company, Inc. (“Falcon”), has filed a voluntary petition for Chapter 11 bankruptcy protection and intends to file a motion for joint administration with Arcapita’s ongoing Chapter 11 restructuring in the United States. The Falcon filing is intended to address pending litigation and liabilities associated with the subsidiary’s 2010 sale of its sole asset, NorTex Gas Storage Company, LLC.
None of Arcapita's operating subsidiaries or portfolio companies are included in the restructuring or are expected to file petitions at any point during the case.
“The decision for Falcon to join Arcapita’s Chapter 11 case reflects the unique circumstances this subsidiary faces as a result of pending litigation and our desire to address these claims as efficiently as possible, under a single Court jurisdiction,” said Atif A. Abdulmalik, Chief Executive Officer of Arcapita. “As we have said from the very beginning, our goal in this process is to restructure our balance sheet and reorganize our business to maximize recoveries for all creditors and other constituencies. We believe the actions we are taking with respect to Falcon are a logical step in this process but we do not anticipate any similar actions with our operating subsidiaries or portfolio companies.”
Arcapita previously announced on March 19 that it and several of its affiliates had filed voluntary cases under Chapter 11 of the United Stated Bankruptcy Code with the goal of developing and confirming a plan of reorganization. The Company believes the U.S. process is in the best interest of all parties involved and is the most effective way to protect its business and assets and implement a comprehensive restructuring that rationalizes Arcapita's capital structure and maximizes recoveries to creditors and other stakeholders.
Arcapita expects to operate its businesses and manage its properties as usual throughout the Chapter 11 process. All of the portfolio companies will continue to be managed by Arcapita's deal professionals and decisions related to asset disposal will remain with Arcapita. Arcapita also will continue to manage approximately $7.4 billion of assets.
Arcapita's legal advisors are Gibson, Dunn & Crutcher and Linklaters, and its financial advisor is Rothschild.
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