USEC (USU -66%) plans to file a pre-arranged and voluntary Chapter 11 petition in Q1 next year after reaching an agreement with creditors who represent more than 60% of the company's notes.
USEC, which supplies enriched uranium for commercial nuclear power plants, will replace $530M in convertible notes that are scheduled to mature in October 2014 with $200M in new debt, as well as new equity. Noteholders will receive 79% of this equity as common stock and existing shareholders 5%.
In a deal under negotiation, Toshiba and Babcock & Wilcox (BWC), which have a preferred convertible equity investment, would jointly receive 16% of the new shares and $40M in debt in exchange for their existing arrangement.
USEC expects to fully meet its obligations to customers and suppliers as its operations continue.
The company also believes that the strong support of its noteholders will accelerate the restructuring of the debt and equity on its balance sheets.
USEC doesn't expect its subsidiaries to file for bankruptcy protection. (PR)