Reuters: Bankruptcy News: Ampal files for Chapter 11 as Egypt natgas halt weighs

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Ampal files for Chapter 11 as Egypt natgas halt weighs Aug 30th 2012, 08:07 JERUSALEM | Thu Aug 30, 2012 4:07am EDT JERUSALEM Aug 30 (Reuters) - Ampal-American Israel Corp filed for Chapter 11 bankruptcy protection as it faces deepening financial troubles in the wake of a halt to natural gas supplies to Israel from Egypt. Ampal holds 12.5 percent of East Mediterranean Gas Co, the sole supplier of gas from Egypt to Israel until the Egyptian government cancelled its 20-year agreement signed in the Mubarak-era earlier this year. It filed a voluntary petition for Chapter 11 reorganisation in the U.S. Bankruptcy Court for the Southern District of New York. Ampal has sought to renegotiate agreements with its bondholders on three series of bonds for eight months and has proposed postponing paying the principle on its bonds by two years while offering bondholders shares in the company. Its bond prices were down 4-6 percent on Thursday. "At this time, the company has determined that the best forum to continue negotiations and to seek approval of a restructure plan is through the Chapter 11 process," Ampal said in a statement. "The company expects to work closely with its Debenture holders, creditors and other stakeholders to implement a restructuring plan through the Chapter 11 case, and to emerge as a financially stronger company." EMG is also 12.5 percent owned by Israel's Merhav. Other stakeholders include Egyptian businessman Hussain Salem, the Egypt Natural Gas Co, Thailand's PTT and U.S. businessman Sam Zell. (Reporting by Steven Scheer)

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