BUNKER INDEX :: Price Index, News and Directory Information for the Marine Fuel Industry

« News Home
:: Monthly Archive

News Topics
:: Air Pollution
:: Agreements & M&A's
:: Alternative Fuels
:: BunkerBlog
:: Cargoes & Storage
:: Company News
:: Efficiency, Costs & Charges
:: Environment
:: Events
:: Financial
:: Fuel Quality & Testing
:: Lubes & Additives
:: Oil Spills
:: People
:: Port News
:: Projects
:: Regulation, Legal
:: Services, Products,Technology
:: Statistics & Research
:: Vessels

Regional Archive
:: Americas
:: Asia/Oceania
:: Europe
:: M.East/Africa

BUNKER INDEX :: Price Index, News and Directory Information for the Marine Fuel Industry
Home » News

Seadrill outlines restructuring plan following Chapter 11 filing

13 Sep 2017 07:44 GMT

Plan extends and re-profiles secured bank debt, reduces leverage and delivers $1.06 billion of new capital.

Seadrill Ltd confirmed on Tuesday that it has filed for Chapter 11 bankruptcy and entered into a restructuring agreement with more than 97 percent of its secured bank lenders, approximately 40 percent of its bondholders and a consortium of investors led by its largest shareholder, Hemen Holding Ltd.

The restructuring plan, which the company says was developed over the course of more than a year, extends and re-profiles the secured bank debt, reduces its financial leverage and delivers $1.06 billion of new capital, comprised of $860 million of secured notes and $200 million of equity.

The company's secured lending banks have agreed to defer maturities of all secured credit facilities, totalling $5.7 billion, by approximately five years, with no amortization payments until 2020 and significant covenant relief.

Additionally, assuming unsecured creditors support the plan, Seadrill's $2.3 billion of unsecured bonds and other unsecured claims will be converted into approximately 15 percent of the post-restructured equity with participation rights in both the new secured notes and equity, and holders of Seadrill common stock will receive approximately 2 percent of the post-restructured equity.

Chapter 11 cases were filed on Tuesday in the Southern District of Texas together with the restructuring plan. The company has also filed 'first day' motions that, if granted, will enable day-to-day operations to continue as usual.

Seadrill requested authority to pay its key trade creditors and employee wages and benefits without change or interruption. Additionally, the company expects it will pay all suppliers and vendors in full under normal terms for goods and services provided during the Chapter 11 cases.

As part of the restructuring process, Seadrill says it has ring-fenced its non-consolidated affiliates from the restructuring process, including Seadrill Partners LLC, SeaMex Ltd, Archer Ltd and their respective subsidiaries. These affiliates, whose individual financial statements are not included in the consolidated or combined financial statements of the parent company, did not file Chapter 11 cases, and Seadrill expects their business operations to continue uninterrupted.

At the time of filing, Seadrill says it had over $1 billion in cash and does not require debtor-in-possession financing.

Commenting on developments, Anton Dibowitz, CEO and President of Seadrill Management Ltd, said: "The restructuring agreement we signed today is a comprehensive plan that raises over $1 billion of new capital, is underpinned by Hemen Holding Ltd., our largest shareholder, and is overwhelmingly supported by our banks and approximately 40 percent of our bondholders.

"This is a testament to our position in the sector, having a large, modern fleet, a top-quality customer base and a proven operating track record. With our improved capital structure, we will be in a strong position to capitalise when the market recovers."

Kirkland & Ellis LLP will be serving as legal counsel during the Chapter 11 process, whilst Houlihan Lokey, Inc. has been engaged as financial advisor, and Alvarez & Marsal as restructuring advisor.

Slaughter and May has been acting as corporate counsel, and Morgan Stanley served as co-financial advisor during the negotiation of the restructuring agreement.

Related Links:

Latest News:

Ceremonies held for MSC Cruises ships with scrubbers
VLCC with '20%' bunker savings delivered to K Line
Vermont Bunkering and staff charged over fraudulent transactions in Singapore
Oil market seems to be struggling to find direction
Oil and fuel oil hedging market update
Aegean expects to launch 'at least one' new bunker supply service in H1 2018
Peninsula signs storage agreement in Houston with HOFTI
Another day in bearish territory?
Oil and fuel oil hedging market update
Aegean posts net loss and 23.2% drop in gross profit
Wartsila launches gas-fuelled version of world's most efficient four-stroke engine
Singapore updates restrictions on selling bunkers to North Korean ships

Page Links:

Latin America
Middle East
North America
North Europe
South Europe
Index Summary
Price Highlights
Cape Town
Las Palmas
New Orleans
Latest News
Middle East
Air Pollution
Agreements & M&A's
Alternative Fuels
Cargoes & Storage
Efficiency, Costs & Charges
Fuel Quality
Lubes & Additives
Oil Spills
Port News
Services, Products, Technology
Statistics & Research
Contact & Terms
Contact Us
Terms & Conditions
Privacy Policy
Upcoming Events