Premier Oil Creditors Vote For Deals, New Debt Plan

Creditors of Premier Oil gave the indebted oil and gas producer their approval for $800 million of North Sea acquisitions under a scheme that would allow it to delay debt repayments and issue new shares. 

The vote supporting Premier's management is a blow to hedge fund ARCM, which holds 15% of Premier's debt and has had a growing short position in its shares since 2017, currently around 17% of its stock, some four times higher than the average for London-listed firms. 

ARCM has fought a heavily publicized battle against Premier's plans, saying they were based on too-high commodity price assumptions, too-low decommissioning liability estimates and would make Premier too dependent on a weak gas market. 


Related: BP, Premier Oil in $625M North Sea Deal


An investor with a short position makes a profit on a stock when its price declines. Premier's shares rose around 20% after it announced its plans on Jan. 7, but have since lost most of that ground to trade at 104.5 pence, up 6.4% year-to-date. 

Shares in Premier Oil spiked higher following the announcement, and by 1317 GMT they were up 3.1% at session highs. 

Premier needs investors representing at least 75% of its outstanding debt of around $2 billion to agree to its plans under an arrangement reached with its creditors in a debt restructuring in 2017. Wednesday's vote still needs to be formally approved by a judge in a hearing expected on March 17. 

Of the creditors subject to the schemes, 86% of Super Senior Commitments and 75% of Senior Commitments have agreed to vote in their favor at the creditor meetings, Premier said, referring to different classes of bondholders. 

(Reporting by Shadia Nasralla in London and Shanima A in Bengaluru; editing by Nick Macfie)


Related: Hedge Fund Questions Premier Oil's Plans



Current News

BP-Eni JV Azule Inks Deal for Namibia Offshore License

BP-Eni JV Azule Inks Deal for

NSTA Awards 31 More Licenses in Latest North Sea Oil and Gas Round

NSTA Awards 31 More Licenses i

Höegh LNG Strikes Deal to Deploy FSRU Hoegh Galleon in Egypt

Höegh LNG Strikes Deal to Depl

BW Offshore Concludes Sale of FPSO Polvo

BW Offshore Concludes Sale of

Subscribe for OE Digital E‑News

Offshore Engineer Magazine