Tue, May 14, 6:54 PM (306 days ago)
CorEnergy Infrastructure Trust, Inc. (CorEnergy) filed for Chapter 11 bankruptcy on February 25, 2024, to facilitate a financial restructuring plan supported by key noteholders. The filing followed a decline in market capitalization and the delisting of its common and preferred stock from the NYSE. The restructuring plan involves converting existing debt into new equity and debt instruments, including a $45 million secured term loan and a $10 million revolving credit facility. The plan aims to ensure sufficient liquidity for continued operations. CorEnergy sold its MoGas and Omega pipeline systems for $175 million in January 2024, leaving the Crimson Pipeline System as its sole operating asset. Crimson's operations, which include crude oil transportation in California, are subject to regulatory and environmental compliance costs. Crimson's financial performance is crucial for CorEnergy's future distributions to shareholders. The company faces risks including operational hazards, regulatory changes, and dependency on key customers. Rising inflation and interest rates may increase costs and financing challenges. The future capital structure post-bankruptcy remains uncertain, potentially affecting existing debt and equity holders. CorEnergy's ability to continue as a going concern depends on successfully implementing the restructuring plan and obtaining court approval. The company has suspended dividend payments and may face challenges in maintaining REIT status, which requires distributing 90% of taxable income to shareholders.