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The Wall Street Journal: Atlas Resource files for Chapter 11 to rid $900 million in debt

Atlas Resource Partners LP filed for chapter 11 bankruptcy Wednesday evening after negotiating a plan to slash some $900 million in debt off its books.

Although the restructuring will substantially reduce the oil and gas producer’s debt, its status as a partnership could leave its investors with a hefty tax bill.

Under the pre-negotiated plan, announced last week, the company’s unit holders will receive no recovery and their ownership stakes will be canceled, Atlas said. As unit holders in a partnership, rather than shareholders in a corporation, these investors could also face a tax bill for the debt that Atlas cancels in chapter 11.

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