Seadrill is aiming to raise US$1 billion in new capital for restructuring efforts that CEO Per Wulff says has been more complex than the company had anticipated.
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The West Tellus, from Seadrill. |
Earlier today (31 January), the drilling contactor filed a 6K detailing its path to secure funds.
The company’s restructuring plan includes its intended road to recovery to achieve a sustainable capital structure. Seadrill is proposing to extend its bank maturities to mature in the period from 2021 to 2023, reducing fixed amortization and amending financial covenants; extend the maturity of unsecured claims to mature in the period from 2025 to 2028; and to raise at least $1 billion in new capital.
"These negotiations have proved to be more complex than we had originally anticipated,” says Per Wullf, CEO and president of Seadrill Management. “Nevertheless, key stakeholders have demonstrated a clear desire to be part of a solution and with the right structure and terms we believe there is significant capital available to us. Seadrill is a great company with excellent people, assets and customers and we look forward to concluding a transaction that ensures Seadrill continues to be well positioned for the eventual recovery in the industry."
Seadrill says that over the past year the company has had substantial dialogue with its secured lenders to amend and extend US$8 billion in first lien secured debt.
“During the second half of last year, we began to engage with potential new money investors, including Hemen Holdings Ltd. In December 2016, we formally engaged with an ad hoc committee of bondholders, and agreed that by January 31 2017 we would release through a 6K filing agreed material non-public information disclosed to the ad hoc committee of bondholders, including the company's latest restructuring proposal and the last proposal that the company has received from the ad hoc committee,” Seadrill says. “Members of the bondholder ad hoc committee have indicated they will consider re-restricting at a future point to again try to work towards an agreement.
Discussions with the banks, potential new money investors, the ad hoc committee of bondholders, and Hemen Holdings continue.
“The company is targeting reaching an agreement on a consensual, comprehensive restructuring prior to the maturity of the West Eminence facility on 30 April 2017,” Seadrill says. “Assuming we achieve this target, we expect the implementation of an agreement to occur during the second quarter of 2017.”
Seadrill is also preparing several contingency plans, should a consensual agreement not be reached.
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