Mountain Express files for Chapter 11 bankruptcy protection

BY Richard Summerfield

Mountain Express Oil Company and certain other affiliated companies have filed for Chapter 11 bankruptcy protection in the US Bankruptcy Court for the Southern District of Texas.

According to the company’s court filing, Mountain Express’ retail network will continue normal operations. The company will use cash collateral to fund and protect its operations if the court rules in its favour, alongside normalising operating cash flows to reach “value-maximising”.

Mountain Express has also confirmed in a press release, that it was in advanced discussions with its secured lenders regarding a commitment of debtor-in-possession financing, which will provide additional liquidity to the company and assure its ability to meet its post-petition obligations in the ordinary course of business. Mountain Express will continue discussions with its financial stakeholders, including critical conversations with its landlords and other key constituents to maximise value for all stakeholders.

“Through this process, Mountain Express will continue to transform the business for the future while bolstering our financial position,” said Turjo Wadud, chief executive of Mountain Express. “I am confident in the strength of our business and our team and look forward to achieving a comprehensive resolution that will best position Mountain Express for long-term success. We continue to have a robust pipeline and will continue to provide opportunities for our dealers, partners, and employees. During this process, we intend to maintain the underlying durability of our business as well as our strong relationships in the industry.”

Mountain Express, which was founded in 2000, currently operates a network consisting of 828 fuelling sites and 27 travel centres throughout 27 states in the US. Its associations include partnerships with major firms such as ExxonMobil, BP, Shell, Chevron, Texaco and Sunoco. The company also has a dealer joint venture with Pilot Co., Knoxville, Tennessee Since 2013, Mountain Express has distributed more than 1.1 billion gallons of fuel, it said.

In 2021, Mountain Express completed a $205m debt financing, which the company said it will use to refinance its existing credit facilities and to support its growth objectives. Later in the year it acquired Brothers Food Mart in New Orleans, which had 50 locations. It also acquired 24 retail locations and the wholesale fuel assets of Texon Oil Inc. in Medford, New Jersey. And in 2022, Mountain Express purchased the 26-unit The Store brand of convenience stores from Team Schierl Cos.

News: Mountain Express Oil to Restructure Following Chapter 11 Filing

Failed battery firm gets a Recharge

BY Richard Summerfield

Recharge Industries, an Australian portfolio company of privately owned US firm Scale Facilitation, has been successful in its bid for ownership of Britishvolt, the battery manufacturer which collapsed into administration in January.

Under plans presented by Recharge Industries, the Britishvolt project will make the UK’s first gigafactory a reality, creating a strategic economic and security asset which will play a critical role in the UK’s industrial and net-zero strategies. The newly acquired Britishvolt will provide thousands of green, skilled and local jobs that will drive local and national benefits, according to a statement announcing the deal.

“We are thrilled to have been successful in our bid for ownership of Britishvolt; our plans are the right ones for the local community and the UK economy,” said David A. Collard, founder and chief executive of Scale Facilitation. “Our proposal combined our financial, commercial, technology and manufacturing capabilities, with a highly credible plan to put boots and equipment on the ground quickly. Our technology – including an exclusive license for the intellectual property and battery technology – has been developed and validated over the last decade through C4V in the US and will be the backbone of both gigafactories in Geelong and Cambois. Backed by our global supply chain, strategic delivery partners and a number of significant customer agreements in place, we’re confident of making the Cambois Gigafactory a success and growing it into an advanced green energy project.”

The original Britishvolt was intended to create a home-grown EV battery industry that can support domestic car production, but the company collapsed in January after failing to raise enough funding for the factory in northern England. The company was a much-heralded part of the UK government’s ‘levelling up’ agenda, however Britishvolt had only raised around £200m by summer 2022 and had pushed back its production timeline. The government had offered £100m to the former Britishvolt owners if they hit certain construction milestones, but they were not met.

The company was planning to build its 30GWh factory in phases to take advantage of rising EV demand ahead of the UK’s 2030 ban of new petrol and diesel cars. The plant, located near Blyth in Northumberland, was expected to employ about 3000 people when operating at full capacity.

Going forward, the new owners will keep the Britishvolt brand name but will focus on batteries for energy storage and hope to have those products available by the end of 2025. Recharge also plans to build a battery factory in Geelong, a former car manufacturing hub in Australia, free from Chinese and Russian materials.

News: Australia's Recharge Industries buys failed battery firm Britishvolt

Starry files for Chapter 11 bankruptcy

BY Richard Summerfield

Boston-based internet service provider Starry Group Holdings Inc. has filed for pre-packaged Chapter 11 bankruptcy protection in an attempt to reduce its debt load while maintaining customer and network operations in five cities.

The company, which filed for Chapter 11 restructuring in the US Bankruptcy Court for the District of Delaware, has filed various motions with the Court, including one for approval of a $43m debtor-in-possession (DIP) financing facility to give it the liquidity to continue operations throughout the process. Starry has approximately $270m in assets versus $310m in total debt, according to a court document.

The bankruptcy filing comes on the back of a bruising period for the company. In January, Starry announced its decision to pull out of one of its markets – Columbus, Ohio – and lay off staff. 2022 was a challenging year as the company defaulted on the opportunity to pick up government funding and found itself the subject of endless speculation on its financial position. In October 2022, Starry laid off around half of its workforce - about 500 people - as the company did not “have the capital to fund our rapid growth”, according to Chet Kanojia, chief executive of Starry. As such, the company was going to focus on its core business of serving multitenant buildings in bigger urban markets.

“Over the last several months, we’ve taken steps to conserve capital and reduce costs in order to put Starry in the best position to explore various financing paths for the company,” said Mr Kanojia. “Our next step in this journey is to continue to strengthen our balance sheet through a Chapter 11 restructuring process. With the support of our lenders, we feel confident in our ability to successfully exit this process as a stronger company, well-positioned to continue delivering an affordable, high-quality broadband experience to our customers.

“The Restructuring Support Agreement provides us with the funding needed to continue operating as normal, through this restructuring process and as we guide the company to profitability. We have a strong and experienced team in place and look forward to moving through this process quickly so that we can continue expanding essential broadband access and #HappyInterneting to more communities across the country,” he added.

Starry currently operates in Boston, New York City, Los Angeles, Denver and Washington, DC, and reported nearly 91,300 customers at the end of September - an increase of 66 percent year-on-year.

News: Starry’s troubles continue as it files for Chapter 11

Second time around: Avaya files for Chapter 11

BY Fraser Tennant

Following months of speculation, American multinational technology company Avaya Holdings Corp. along with its US subsidiaries has filed for Chapter 11 bankruptcy and entered into a restructuring support agreement (RSA).

The filing in the US Bankruptcy Court for the Southern District of Texas is the second time in six years the North Carolina-based Avaya has sought bankruptcy protection.

The Chapter 11 process will help Avaya to implement the RSA and accelerate its ongoing business transformation, significantly enhance its ability to invest in its innovative cloud-based communications portfolio and position the company for long-term success.

Completing the RSA will reduce Avaya’s total debt by more than 75 percent, from approximately $3.4bn to approximately $800m. In addition, it will substantially increase Avaya’s cash and strengthen its liquidity position.

“Strengthening Avaya’s capital structure is a critical step to fully realize our transformation,” said Alan Masarek, chief executive of Avaya. “We are excited to move ahead as a well-capitalised company with one of the strongest balance sheets in our industry that includes substantial cash to invest in our own success.”

“I joined Avaya to help unlock the power of its iconic brand, global customer footprint, massive partner ecosystem, large-scale communications deployments and outstanding team,” he continued. “Building on this tremendous foundation, we have made significant progress pioneering an ambitious business model transformation, establishing a competitive product strategy for our subscription and cloud-delivered services and implementing operational efficiencies to better serve the Avaya ecosystem.”

Avaya has stated that it will continue serving its customers and partners without interruption and providing them with outstanding communications solutions, service and support.

Moreover, due to the overwhelming support of its financial stakeholders, Avaya expects to implement the RSA on an expedited basis and complete this comprehensive balance sheet deleveraging within 60 to 90 days. These actions will not impact the company’s customers, channel and strategic partners, suppliers, vendors or employees.

“We appreciate the strong support from our investors, who recognise the incredible value in Avaya’s business, brand and opportunities ahead,” concluded Mr Masarek. “With this additional financial strength, we will be ideally positioned to accelerate innovation and advance our cutting-edge, long-range product roadmaps for the benefit of our customers.”

News: Avaya files for Chapter 11 bankruptcy

Britishvolt calls in administrators

BY Richard Summerfield 

Britishvolt, the battery startup company which had planned to build a giant factory to make electric car batteries in Blyth, Northumberland, has collapsed into administration. 

The company has appointed EY as administrators after failing to raise enough funding. The firm described the move as “disappointing”, and said all impacted staff were being offered support. The majority of Britishvolt’s 232 staff have been made redundant, with just 26 being kept on to assist with the sale of the company’s business and assets. 

Dan Hurd, joint administrator and partner at EY, said the firm had offered “a significant opportunity to create jobs and employment, as well as support the development of technology and infrastructure needed to help with the UK’s energy transition. It is disappointing that the company has been unable to fulfil its ambitions and secure the equity funding needed to continue. Our priorities as joint administrators are now to protect the interests of the company’s creditors, explore options for a sale of the business and assets, and to support the impacted employees.” 

The collapse of Britishvolt came after funding talks failed, leaving a string of disappointed backers ranging from FTSE 100 companies Glencore and Ashtead to property investor Tritax, owned by investment group abrdn, which had committed to fund a battery ‘gigafactory’ in Northumberland. 

Plans for the £3.8bn factory were part of a long-term vision to boost UK manufacturing of electric vehicle batteries and create around 3000 skilled jobs. The factory was expected to produce over 300,000 lithium-ion batteries a year by 2027.  

However, the company has been on shaky ground for some time. Britishvolt consistently pushed back its construction plans. It was expected that the first lithium-ion batteries would roll off the production line by the end of 2023, with the firm partnering with Siemens to make that a reality. That date was later pushed to mid-2025 due to a factory redesign, as well as “rampant inflation and rising interest rates”.

In November 2022, the company secured a short-term investment to stay in business and announced that its staff had agreed to take a temporary pay cut while the company attempted to secure longer-term funding for its planned gigafactory project in northern England. As of summer 2022, Britishvolt had only raised around £200m of funding, and £100m of promised government funding was delayed due to key targets for the investment being missed.

“As part of our efforts to see British companies succeed in the industry, we offered significant support to Britishvolt through the Automotive Transformation Fund on the condition that key milestones – including private sector investment commitments – were met,” said a department for Business, Energy and Industrial Strategy spokesman. “We remained hopeful that Britishvolt would find a suitable investor and are disappointed to hear that this has not been possible, and therefore no ATF grant has been paid out. Our thoughts are with the company’s employees and their families at this time, and we stand ready to support those affected. The UK is one of the best locations in the world for automotive manufacturing, and we want to ensure the best outcome for the site. We will work closely with the local authority and potential investors to achieve this.” 

News: Britishvolt: UK battery start-up collapses into administration