A preliminary merger agreement with Knoxville-based Pilot Travel Centers is expected to help Flying J Inc. emerge from Chapter 11 bankruptcy protection.
The agreement was announced by the companies Tuesday in press releases.
The terms of the Letter of Intent filed Tuesday with the U.S. Bankruptcy Court in Delaware say the value indicated would allow Flying J to pay all its debt in full.
Pilot has also agreed to provide $100 million in Debtor-in-Possession financing for Flying J’s operations. That’s subject to court approval and some conditions.
The preliminary merger agreement is specifically for Flying J’s core travel plaza business.
It excludes Longhorn Pipeline, Big West Oil, Flying J Oil & Gas, Haycock Petroleum and Transportation Alliance Bank.
Flying J is pursuing and evaluating alternatives for each of these other businesses.
Flying J filed for Chapter 11 protection on December 22, 2008, after a drop in oil prices and disruption in the credit markets.
Flying J is based in Ogden, Utah. It’s among the 20 largest private companies in America and employs around 14,700 people in the U.S. and Canada.
Pilot Travel Centers LLC is the nation’s largest retail operator of Travel Centers. It has locations in 41 states with more than 300 retail interstate properties. The company employs 13,000 people nationwide.
Flying J’s legal advisor is Kirkland & Ellis LLP and its financial advisor is The Blackstone Group L.P.
Pilot’s legal advisor is White & Case LLP.
Source: WATE
