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What happened?
The future looks very uncertain for Linn Energy (NASDAQ:LINE) and its close affiliate, Linn Co. (NASDAQ:LNCO), as the two entities announced they are exploring "strategic alternatives" for their business.

In a press release, the pair quoted CEO Mark Ellis as saying that "we believe it is prudent to explore opportunities to strengthen our balance sheet and ensure we have adequate financial flexibility to manage through prolonged commodity price headwinds."

The companies have retained financial and legal services companies to advise it in the process.

Lead company Linn Energy is heavily indebted, and not long ago exhausted the borrowing available to it under a $3.6 billion credit facility loan.

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Does it matter?
To say that Linn Energy and Linn Co. have been hit hard by the sharp decline in oil prices would be an understatement. Both are been deeply in the red these days, while the former's long-term debt figure recently crossed over the $10 billion mark (it had just under $2.2 billion in equity at the end of its latest reported quarter).

It's clear some help is very much needed, be it an equity-for-debt arrangement of some kind, a takeover, or any other type of deal that would keep the Linn family going. But this is a bad time for oil companies to look for assistance, as the crude price seemingly refuses to rise from the floor, and investors are basically staying away from the sector.

At this point, of course, it's hard to say if and to what degree the Linn Energy/LinnCo's search for "strategic alternative(s)" will be successful. Regardless, their future is sure to be affected dramatically. Ideally, the pair will be able to salvage its collective finances enough to soldier on, but that's assuming it can find a party or parties willing to get involved in a tough and challenging situation. 

Eric Volkman has no position in any stocks mentioned. Nor does The Motley Fool. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.