A Houston bankruptcy court has approved drilling firm Seadrill’s plan to reorganize the company. It’s coming out of a letter to the Oslo Stock Exchange late Friday night.
The plan lays out a roadmap for Seadrill to get the debt under control, now that the company already has the backing of a majority of creditors.
– We’re happy with this development, which means we’re on our way out of Chapter 11, says CFO Grant Creed in the report.
Chapter 11 means that the company is subject to temporary bankruptcy protection.
Creed maintains that the court approved the company’s schedule and gave the company permission to approve a creditors’ vote, which he says will open up a significant improvement in the accounts’ balance sheet.
This is the plan
With Seadrill winning, the company can begin to gather broader support for the plan it presented on July 24. The main points of the plan are to convert the bank’s debt of $5.6 billion to $750 million, and for the creditors to have the first right to contribute a new loan of $300 million. In return, the lenders hold 99.75 percent of the shares in the company, while the existing owners, including Frederiksen, get the remaining crumbs.
But main owner John Frederiksen, who has battled for Seadrill to complete a second restructuring since 2018 without dismantling it, will also be involved: He’s contributing a convertible $50 million loan that could give him 5% of the stock.
The plan is backed by 58 percent of creditors, but it requires two-thirds of each of the company’s 12 loans.
Since Seadrill began bankruptcy in February, hedge fund firm Strategic Value Partners has distinguished itself as the most aggressive creditor.
The senior vice president paid all the way for Seadrill to sell rigs — and even better then to SVP Dolphin Drilling’s own rig company, which has made several bids in recent months.
SVP owns only three percent of Seadrill’s large bank debt, but he used all the money he had as a creditor before the case in Texas. In recent months, conflict has escalated between the two parties, with Seadrill describing the senior vice president as a “hostile lender” trying to track down the bailout.
Lying. “Screaming legal shortcomings”. A disgusting waste of resources. This is how Seadrill’s lawyers described their SVP creditor, led by Victor Khosla.
SVP’s Dolphin – a company that arose after Fred’s bankruptcy. Olsen Energy in 2019 – Joined giant Transocean to bid on all Seadrill platforms. A third partner is also involved, who was previously unknown. But DN previously wrote that it was about the Egyptian drilling company ADES.(Terms)Copyright Dagens Næringsliv AS and/or our suppliers. We would like you to share our cases using a link that leads directly to our pages. All or part of the Content may not be copied or otherwise used with written permission or as permitted by law. For additional terms look here.
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