Kirkland & Ellis LLP Restructuring Group Launches into 2010 with High-Profile Filings and Emergences

The Restructuring Practice Group of Kirkland & Ellis LLP kicked off 2010 with several large, high-profile bankruptcy filings and emergences, including The Reader's Digest Association, Inc., which announced its emergence from bankruptcy yesterday.

"We are managing a tremendous volume of work, including more than 15 ongoing debtor-side cases. Kirkland has remarkable depth, which has allowed us to maintain this level of activity while helping our clients successfully restructure and emerge as viable businesses," said Richard Cieri, partner in the Firm's New York office.

Emergences:

The Reader's Digest Association, Inc.

RDA announced on February 22, 2010, that it successfully completed its financial restructuring and emerged from prearranged Chapter 11. The company reduced its debt by $1.5 billion and lowered its gross operating leverage. With a significantly improved capital structure, RDA is positioned to continue its transformation into a multi-platform, multi-brand media and marketing company that educates, entertains and connects 130 million people around the world. RDA's restructuring commenced in August 2009. James H.M. Sprayregen and Paul Basta represented RDA.

Stallion Oilfield Services Ltd.

Kirkland represented Stallion Oilfield Services, which emerged from Chapter 11 bankruptcy protection on February 2, 2010. Stallion, which provides construction and logistics services for drilling rig operations, emerged with unanimous support from its creditors, eliminating $515 million of debt. Stallion filed for bankruptcy with 17 affiliates on October 19, 2009, listing both estimated assets and liabilities in the range of $500 million to $1 billion. Partner Jonathan Henes and associate Chad Husnick completed the transaction.

Muzak Holdings LLC

Kirkland represented Muzak Holdings, designer and installer of professional sound systems, and its affiliates, which emerged from Chapter 11 bankruptcy protection on February 1, 2010. Virtually all of Muzak's funded debt obligations matured in the midst of the credit crisis. Unable to refinance its $500 million in debt obligations, Muzak was forced to file for Chapter 11. In less than one year, Muzak negotiated and implemented a global financial restructuring that cut its debt obligations in half while paying its secured creditors and trade creditors in full in cash. Muzak's plan of reorganization was unanimously approved and the company emerged from Chapter 11 with $190 million in financing. The reorganization plan cut Muzak's debt load of $460 million in half. The Kirkland team was led by partners Edward Sassower and Joshua Sussberg, and included associates Sarah Seewer, Christopher Greco and Meredith Shafe.

ION Media Networks

Kirkland represented ION Media Networks, Inc., in its emergence from Chapter 11 bankruptcy protection on December 18, 2009, eliminating approximately $2.7 billion in legacy debt. ION, the owner and operator of the nation's largest broadcast television station group and ION Television, which reaches more than 96 million U.S. television households via its nationwide broadcast television, cable and satellite distribution systems, and 116 of its affiliates, filed for Chapter 11 on May 19, 2009, in the U.S. Bankruptcy Court for the Southern District of New York. James H.M. Sprayregen and Jonathan Henes led the Kirkland team.

Numerous Project Subsidiaries of GGPLP L.L.C.

Kirkland is a co-counsel representing GGPLP L.L.C. and numerous affiliates in their Chapter 11 reorganization. GGP and its consolidated affiliates reported approximately $29.6 billion in total assets and $27.3 billion in total liabilities as of December 31, 2008. Through its affiliates, GGP owns and manages more than 200 regional shopping centers and other properties across 44 states. GGP's bankruptcy filings constitute the largest Chapter 11 cases undertaken by a real estate investment trust in U.S. history. Since the commencement of GGP's Chapter 11 reorganization on April 16, 2009, Kirkland has assisted GGP in confirming plans of reorganization for 216 of GGP's project-level subsidiaries, restructuring 96 loans totaling approximately $11.5 billion in secured indebtedness across 111 properties. To date, 205 of these GGP affiliates have closed on their respective loans and emerged from Chapter 11. Kirkland continues to advise certain of the remaining GGP debtors in their ongoing Chapter 11 cases.  Partners James H.M. Sprayregen and Anup Sathy and associate Chad Husnick lead the Kirkland team.

Filings:

Japan Airlines

Kirkland is serving as U.S. counsel to Tokyo-based Japan Airlines (JAL), Asia's largest air carrier by revenue. JAL filed for bankruptcy protection in Japan and the United States on January 19, 2010. The filing came after months of negotiations between JAL and the Enterprise Turnaround Initiative Corporation, a Japanese government-backed fund overseeing a restructuring plan. According to its Chapter 15 filing in U.S. bankruptcy court, JAL is carrying a total debt load of $28 billion. Restructuring partners James H.M. Sprayregen, Ryan Bennett and David Seligman in the United States, Kon Asimacopolous and Paul Atherton in London, and Helena Huang in Hong Kong lead an integrated team which includes restructuring, intellectual property, litigation and employee benefits attorneys from Kirkland's Chicago, New York, London and Munich offices.

Atrium Corporation

Kirkland represents Dallas, Tex.-based Atrium Corp., a window and patio door manufacturer, in its bankruptcy filed in the U.S. Bankruptcy Court for the District of Delaware on January 19, 2010. Atrium has received commitments for a $40 million debtor-in-possession facility and another $125 million in equity investments. Partners Richard Cieri and Joshua Sussberg, and associate Brian Schartz lead the Kirkland team.

Confirmations:

DBSD North America

Kirkland is representing DBSD North America, Inc. and its subsidiaries, a development-stage enterprise that is designing and developing an integrated mobile satellite and terrestrial services network to deliver wireless satellite communications services to mass-market consumers, in its ongoing Chapter 11 cases. The company is seeking to restructure approximately $800 million in outstanding liabilities. The U.S. Bankruptcy Court for the Southern District of New York confirmed DBSD's reorganization plan on November 24, 2009. James Sprayregen, Christopher Marcus and Marc Carmel lead the Kirkland team.

About Kirkland & Ellis LLP

Kirkland & Ellis International LLP is a 1,500-attorney law firm representing global clients in complex restructuring, corporate and tax, litigation, dispute resolution and arbitration, and intellectual property and technology matters. The Firm has offices in Chicago, Hong Kong, London, Los Angeles, Munich, New York, Palo Alto, San Francisco, Shanghai and Washington, D.C.