Dune Energy cancels acquisition deal, files Chapter 11 bankruptcy

Dune Energy Inc. (OTCBB: DUNR) has canceled an acquisition by Eos Petro Inc. (OTC: EPOT) and has filed for Chapter 11 bankruptcy protection to reorganize, according to the Houston Business Journal.

Dune is requesting approval of $10 million in debtor-in-possession financing from its bankruptcy lenders and will continue to operate its oil and gas production facilities as a debtor-in-possession. The company has assets of $229.5 million and debts of $144.2 million, said the Wall Street Journal, which also reported that Dune’s restructuring process is expected to be completed within 130 days, and that lenders are requiring that Dune put itself up for auction as a condition of the $10 million loan.

The acquisition deal with Eos Petro fell apart recently when Eos Petro was reportedly unable to obtain the financing needed to complete the deal.

Dune has defaulted on its loans and its attempts to find other financing options have proven unsuccessful. The company’s board of directors authorized the bankruptcy filing on March 3.

On March 9, Dune’s stock price was $0.03/share on the OTCBB.

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