Chesapeake Energy Files for Bankruptcy

In a widely anticipated move, Chesapeake Energy (NYSE: CHK) has filed for Chapter 11 bankruptcy to complete a comprehensive balance-sheet restructuring. The energy company hopes to both strengthen its balance sheet and restructure some of its legacy contractual obligations. This process would enable it to reemerge with a more sustainable capital and cost structure.

Chesapeake Energy has entered into a restructuring support agreement with many of its creditors. As a result, the company intends to implement a reorganization plan that would eliminate roughly $7 billion of its outstanding debt. That would be a sizable reduction for a company that recently had about $9 billion of debt outstanding.

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Source Fool.com