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Seadrill’s Bankruptcy Exit Plan Receives US Court Approval
A U.S. judge said April 17 he would approve Seadrill Ltd.’s (NYSE: SDRL) plan to exit its Chapter 11 bankruptcy, in which the global offshore oil and gas drilling company would shed billions of dollars of debt and raise $1 billion in new investment. U.S. Bankruptcy Judge David Jones in Houston overruled two minor objections to the reorganization plan during a 90-minute hearing. The plan extends maturities on more than $5 billion of bank loans and converts about $2.3 billion in bond debt into equity in a reorganized Seadrill.
In addition, the plan will raise about $1 billion in new debt and equity through a rights offering led by Seadrill’s largest shareholder, John Fredriksen, and investment firm Centerbridge Credit Partners LP. “The company will have a tremendous competitive advantage with the new balance sheet,” said Spencer Winters, a lawyer for Seadrill with the Kirkland & Ellis, at the April 17 hearing.Seadrill, which competes with Nabors Industries Ltd. (NYSE: NBR) and Ocean Rig UDW Inc., operates a fleet of more than 30 vessels and was once the largest driller by market value. The company’s stock trades on the Oslo and New York stock exchanges and it has corporate offices around the world. Following a deep drop in oil prices beginning in 2014, the offshore service industry suffered from a glut of capacity and low market rates, a problem that lingers today. Mike Williams Authentic Jersey
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