Westinghouse files for Chapter 11 protection in US and secures $800M in DIP financing to fund operations
Westinghouse Electric Company and certain of its subsidiaries and affiliates, filed voluntary petitions under Chapter 11 of the US Bankruptcy Code. The company is seeking to undertake a strategic restructuring as a result of certain financial and construction challenges in its US AP1000 power plant projects. Westinghouse has obtained $800 million in debtor-in-possession (DIP) financing from a third-party lender to help fund and protect its core businesses during its reorganization.
The Chapter 11 filings took place in the US Bankruptcy Court for the Southern District of New York in New York City.
The DIP financing will fund Westinghouse’s core businesses of supporting operating plants, nuclear fuel and components manufacturing and engineering as well as decommissioning, decontamination, remediation and waste management as the company works to reorganize around these strong business units. Existing letters of credit have been cash collateralized in full and will remain in place. The financing will also allow for new letters of credit to be issued.
The company has reached an agreement with each owner of the US AP1000 projects to continue these projects during an initial assessment period. Westinghouse remains committed to its AP1000 technology as the industry’s premier Gen III+ nuclear power plant design, and will continue its existing projects in China as well as pursuit of other potential projects in the future.
Westinghouse’s operations in its Asia and Europe, the Middle East and Africa (EMEA) Regions are not impacted by the Chapter 11 filings.
As part of today’s Chapter 11 filings, Westinghouse also filed several “first day” motions with the Court to ensure business continuity through payment of employee salaries, wages and benefits, as well as pay its suppliers for the delivery of services. The motions are expected to be approved by the Bankruptcy Court. Westinghouse is represented by Weil, Gotshal & Manges LLP in its Chapter 11 cases.