Dallas — Blackhill Partners, an investment banking firm specializing in complex situations, has completed the restructuring of Pacific Exploration & Production and its related entities. Pacific retained Blackhill as restructuring advisor and chief restructuring officer (CRO) to guide the company through a $5.4 billion multi-jurisdictional restructuring process, administered collectively under the insolvency laws of Canada, Colombia and the U.S. Pacific Exploration & Production has its primary operations in Colombia and Peru, and the restructured company is traded on the Toronto Stock Exchange (TSE: PEN).
Jim Latimer, Managing Director of Blackhill Partners, served as CRO to guide Pacific through the reorganization and now will serve as the company’s interim CEO. Latimer has 35 years’ experience managing oil and gas companies as well as 18 years’ experience in restructuring, with particular expertise in CRO, operational restructuring, and distressed mergers and acquisitions. He was assisted in the restructuring by Blackhill Managing Directors Steve Strom, Jeff Jones, and Dan Gillett.
Pacific was the largest private exploration and production company operating in Colombia, producing 75,000 barrels per day and employing 1700 people. The company had US $5.4 billion in debt at the time of the filing, making it the second largest exploration and production insolvency in the current down cycle, and one of the five largest exploration and production insolvencies ever. The plenary filing was conducted under the Companies' Creditors Arrangement Act (Canada) process in Toronto, and thus far Pacific has been the largest new insolvency filing in Canada this year.
The restructuring substantially improved the capital structure of Pacific by reducing the amount of outstanding debt from U.S. $5.4 billion to U.S. $250 million. In addition, the company exited with over $500 million in cash and has achieved positive cash flow.
For this complex engagement, Blackhill partnered with a team from Acquest Advisors led by Sheldon Stoughton. Acquest is a Houston-based investment banking firm with a focus on advising clients across all segments of the energy industry.