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 Chanin Capital Partners represented the Official Committee of Unsecured Creditors (the “Committee”) in connection with the bankruptcy filing and sale of Mississippi Chemical Corporation (“Mississippi Chemical” or the “Company”) to Terra Industries, Inc. ("Terra").
- Mississippi Chemical is one of the largest manufacturers and marketers of agricultural-grade ammonium nitrate fertilizer in the United States.
- On May 15, 2003, Mississippi Chemical filed for Chapter 11 in the United States Bankruptcy Court, Southern District of Mississippi, after missing the coupon payment on its Senior Notes.
- The Company’s liquidity crisis was caused by a prolonged cyclical downturn for its products coupled with high raw materials costs (primarily natural gas).
- As Financial Advisor to the Committee, Chanin assisted in arranging an alternative $160 million DIP Facility for the Company so that it could take out the existing secured lenders and retain its 50% interest in its very profitable Trinidad ammonia plant.
- On August 9, 2004, the Company entered into an agreement under which Terra would acquire Mississippi Chemical. Chanin played an integral part in the negotiations between Terra and the Company in this transaction.
- On December 21, 2004, Terra completed the acquisition of Mississippi Chemical for approximately $350 million. As part of the transaction, Terra issued common and preferred stock to Mississippi Chemical’s Unsecured Creditors with an estimated closing value of approximately $160 million.
- Chanin also negotiated the transfer of the Company’s Phosphates business to certain Unsecured Creditors as a final hurdle to the completion of the Terra acquisition.
- Since the filing, Mississippi Chemical’s $200 million of 7.25% Senior Notes due 2017 rallied from 8% to approximately 73% of face value as of December 31, 2004, a nine-fold increase.
In January 2005, at the conclusion of the case, the Committee filed an application with the court seeking a special fee enhancement for Chanin. In the application, the Committee characterized Chanin’s efforts and the results achieved as “...well beyond the expectations of the Committee, both in terms of the amount and the timing of creditor recoveries."
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