October 27, 2014

Restructuring eliminates more than $3 billion of debt from MPM’s balance sheet as company exits bankruptcy just six months after filing. 

On October 24, 2014, Momentive Performance Materials, Inc. and its affiliates (“MPM”) successfully consummated its prenegotiated plan of reorganization and exited from bankruptcy just six months after its bankruptcy filing.  Willkie led the complex representation of MPM, a maker of silicone and quartz products, and 11 of its affiliates in connection with their chapter 11 bankruptcy cases before the Honorable Robert D. Drain in the United States Bankruptcy Court for the Southern District of New York.  Prior to its filing, Willkie led the negotiation and documentation of MPM’s prenegotiated plan of reorganization, which had the support of approximately 90% of its second lien noteholders.  The restructuring resulted in the elimination of more than $3 billion of debt from MPM’s balance sheet.  Willkie successfully represented MPM in heavily contested hearings including a one-week trial with respect to the confirmation of its proposed Plan of Reorganization.  On August 26, 2014 in a four-hour-long bench ruling, Judge Drain ruled in favor of the Debtors on every contested point.  Among other rulings, Judge Drain approved the cramdown  provisions of the Plan applying the Supreme Court’s decision in Till to award a below-market rate of interest on replacement securities for senior lenders, in a decision that  may have repercussions in many future restructurings.  Trustees for certain of the Company’s debt issuances have appealed Judge Drain’s decision to the District Court for the Southern District of New York.

The matter was primarily handled by partners Matthew Feldman, Rachel Strickland, Joseph Baio, Roger Netzer, James Dugan, William Hiller, Henry Cohn and Cristopher Greer; special counsel Ajanaclair Lynch; associates Jennifer Hardy, Theodore Neos, Dan Kozusko, Ji Kim, Andrew Mordkoff, Christopher Koenig, Nicole Naples, Veronica Ng, Joseph Antignani, Stephen Mouritsen, Alexis Anzelone, Kevin Brown and William O’Brien.