Power Plant Operator Sundevil Holdings Declares Bankruptcy

by San Antonio Attorney

Gas-fired power plant Sundevil Holdings declared bankruptcy on Feb. 11 due to a default on a $237 million debt.

The Arizona-based power plant operator, funded by Wayzata Investment Partners, made the Chapter 11 filing in the U.S.  Bankruptcy Court in Washington.  The company said that the main cause for its financial troubles is the dwindling electricity prices in the market, along with cheaper natural gas and energy prices.

When Sundevil purchased Arizona power plants for the purpose for re-expansion, the demand did not increase even after a financial downturn.

In June 2015, prior to the company’s filing for bankruptcy, Sundevil hired an investment banker to scout for other investors.  Even with potential investors, there was no further confirmation for an official purchase for some of the assets, according to the court papers.

Through a bankruptcy auction process, Sundevil aims to sell the company.  The proposed deadline will be April 29, to be receiving bids and an auction will be held on May 2.

Two of the four natural gas-powered plants located in the Gila River Power Station in Arizona are owned by Sundevil.  These plants sell energy to consumers located in Arizona, New Mexico and Southern Nevada.

Sundevil was established in 2010 when Wayzata made its official purchase of two power plants from a partner of Entegra Power Services.

Sundevil has not restored its operations since October 2015 due to economical issues.  The company has generated $63.9 million in total revenue.  It has a pending debt of $237 million to Beal Bank USA.  They made another debt to the same bank, in order to fund its operations during the Chapter 11 Bankruptcy.

A Friday hearing was scheduled by Judge Kevin Carey to deal with the company’s first day in Chapter 11 request.  The bid to tap into the bankruptcy loan and set a schedule for bidding will also be done.

 

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