USEC BANKRUPTCY JUDGE: WHAT’S THE POINT?

A federal bankruptcy judge questioned the long-term viability of USEC in an initial Thursday hearing of USEC’s Chapter 11 bankruptcy filing. USEC is seeking additional government support and a reorganization of its debt in the hopes that improving market conditions will eventually back its American Centrifuge Project. “What exactly is the point of reorganizing the balance sheet of a company that has no business plan other than keep us on life support for the next six to ten years in the hopes that this technology may ultimately be commercial, be able to be brought to market and that can’t survive past April 14 without additional funding from the United States?” U.S. Bankruptcy Judge Christopher Sontchi asked

 

USEC attorney Jan Baker replied: “In the era of Solyndra and the adverse commentary that that has attracted, it’s a very difficult thing to go to the federal government and say, as we did two years ago, we need a two-billion-dollar loan guarantee, oh, and by the way, the final step will be, we anticipate we might have to go through a prepackaged or pre-arranged bankruptcy in order to deleverage our balance sheet. But if you give us the guarantee, we’ll be prepared to do that.” 

 

Baker added: “The company’s management and board believe that taking these steps is a precondition to successfully making the case to Congress and the Department of Energy for continued government support of the centrifuge project, but would absolutely not want to suggest to Your Honor or anyone else, that doing so will necessarily ensure continued government support.”