John Fredriksen’s Seadrill has won some much needed extra breathing space to get its restructuring plan in place. The rig company now has until September 12 to come up with a plan. The company has also received lender consent to extend the maturity date under a US$400m credit facility from August 31 until September 14.
“The Company is in advanced discussions with certain third party and related party investors and its secured lenders on the terms of a comprehensive recapitalization, which remain subject to further negotiation, final due diligence, documentation and requisite approvals,” Seadrill said in a release today, adding that implementation of a comprehensive restructuring plan will likely involve chapter 11 proceedings. Seadrill warned that the restructuring will require a substantial impairment or conversion of bonds, as well as impairment and losses for other stakeholders, including shipyards.
Shareholders are likely to receive minimal recovery for their existing shares, Seadrill stressed.
Norwegian tycoon Fredriksen has related in interviews this year how the restructuring of Seadrill has proven to be the most complex financial deal he has encountered in more than 50 years in shipping.
