Inversiones Latin America Power Limitada’s Prepackaged Bankruptcy Chapter 11

Cleary Gottlieb is representing an ad hoc group of holders comprising more than $328 million (or more than 80%) of the 5.125% senior secured notes due 2033 issued by Inversiones Latin America Power Limitada (ILAP) and its subsidiaries in a voluntary restructuring through a Chapter 11 plan in the United States by ILAP.

Together with another secured creditor, the ad hoc group’s participation in ILAP’s restructuring process has paved the way for a prepackaged plan of reorganization that would significantly delever ILAP without affecting non-financial creditors.

ILAP is a Chilean renewable energy company that owns and operates two wind farm projects in Chile: a 193.2 MW facility located in Freirina, Vallenar in the Atacama region, the second-largest wind farm project by capacity in Chile, and a 46 MW facility located in Canela, in the Coquimbo region. After recognizing its inability to service its existing secured debt, ILAP and the ad hoc group commenced negotiations designed to arrive at a consensual debt restructuring, culminating in an agreement on a prepackaged plan of reorganization. The debtors filed their Chapter 11 petitions and first day pleadings in the U.S. Bankruptcy Court for the Southern District of New York on November 30, 2023.

In broad terms, the plan contemplates that ILAP, its subsidiaries, and an affiliate will issue take-back senior secured notes and convertible notes in satisfaction of the existing notes and obligations under a letter of credit facility, and will raise exit financing from the sale of super-priority notes.