Lifeline: Chesapeake’s $4B Line of Credit Reaffirmed by Banks

Chesapeake EnergyDon’t tell Crazy Bernie Sanders, but apparently Big Banks (like the ones he wants to dissolve) believe Chesapeake Energy is (like the banks themselves) “too big to fail.” Yesterday Chesapeake’s Big Bank backers reaffirmed the company’s $4 billion line of credit. Twice each year oil and gas company holdings/assets are evaluated and a determination made of their value–because those holdings/assets are used as collateral should a company like Chesapeake go bankrupt. Which lately has seemed like a distinct possibility (see Chesapeake Energy: We’re Not Filing for Bankruptcy…Yet). Yesterday’s action pretty much ensures Chessy will stay out of bankruptcy court, at least until 2017, because the company has the ability to borrow oceans-full of money–up to $4 billion. In an unusual move, Chesapeake’s lenders have postponed another such “redetermination” until June 2017, more than a year from now…

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