Chesapeake Energy, the second-largest natural gas producer in the United States, plunged as much as 50% on Monday 8th after multiple reports that it had hired restructuring attorneys.
Chesapeake shares fell from $2.05 to $1.01, with morning trading halted at least eight times. The company, which has more than $10 billion of debt, seems to have been affected by the steep worldwide fall in oil and gas prices. According to Reuters, the company’s bonds maturing next month plunged 20 points, to a level of 75 cents on the dollar, once the news was made public.
Despite these reports, the energy company said in a statement (below) that it has no plans to pursue bankruptcy, and that their shareholders are the main concern.
“Chesapeake Energy Corporation (NYSE:CHK) stated today that Kirkland & Ellis LLP has served as one of Chesapeake’s counsel since 2010 and continues to advise the company as it seeks to further strengthen its balance sheet following its recent debt exchange. Chesapeake currently has no plans to pursue bankruptcy and is aggressively seeking to maximize value for all shareholders.
Chesapeake Energy Corporation (NYSE:CHK) is the second-largest producer of natural gas and the 12th largest producer of oil and natural gas liquids in the U.S. Headquartered in Oklahoma City, the company’s operations are focused on discovering and developing its large and geographically diverse resource base of unconventional natural gas and oil assets onshore in the U.S. The company also owns substantial marketing and compression businesses.”