After months of speculation surrounding its deteriorating financial situation, Linn Energy (NASDAQ:LINE) filed for Chapter 11 bankruptcy protection in the United States Bankruptcy Court for the Southern District of Texas on Wednesday. Along with this move, LinnCo (NASDAQ:LNCO) was included as a debtor in the bankruptcy filing, and as of the time of the bankruptcy filing, the company held a roughly 67% equity interest in Linn Energy. This sharp increase in ownership is largely due to an exchange offer, which LinnCo announced in March, that allowed unitholders of Linn Energy to exchange their units, on a one-for-one basis, for shares of LinnCo in a move to try to prevent the occurrence of cancellation of debt income (or CODI) in a restructuring scenario. This bankruptcy paints a bleak outlook for the partnership's units and for its debtholders, as the common unitholders will likely be completely wiped out and various creditors will hold the new equity of the firm, although the ultimate value of Linn Energy following a potential exit from bankruptcy, which is anticipated in late 2016, is highly uncertain.

http://seekingalpha.com/article/3974358-linn-energys-bankruptcy