Paris-based geophysical firm CGG will file for Chapters 11 and 15 bankruptcy in the US, and open a Sauvegarde proceeding in France, after executing legally binding agreements in support of the terms of the agreement-in-principle with key financial creditors announced on 2 June.
Despite the bankruptcy filings, CGG CEO Jean-Georges Malcor said it would be “business as usual” at CGG during the process, and that the restructuring transactions will not affect relationships with CGG’s clients, business partners, vendors or employees.
“We will maintain our commitment to operational excellence and our customers can be confident that they will continue to receive the best-in-class service and support and innovative solutions they are accustomed to without interruption,” Malcor said in a 14 June press release. “We expect that our financial restructuring can move forward quickly to strengthen our balance sheet and to position the company well for the future.”
The 2 June agreement-in-principle with CGG’s main creditors and the DNCA has been signed, and the restructuring plan meets CGG’s objectives of substantially reducing the debt on its balance sheet while preserving the integrity of the CGG Group, Malcor added.
In March, the company announced plans to significantly reduce debt levels and related cash interest costs to align them with CGG’s cash flows. This strategy is based on the company’s 2017-2019 business plan, which assumes oil prices will trade between US$50/bbl and $65/bbl over the next two years, and a modest uptick in exploration investment starting in 2H 2018.