Tidewater draws down $600m

Tidewater draws down $600m

NYSE-listed Tidewater has drawn down the maximum $600m from its revolving credit facility, which it says will be used “to enhance the company’s liquidity position and financial flexibility”.

Jeff Platt, Tidewater’s president and CEO, said the offshore supply vessel operator had been hit hard as its clients continue to reduce their capital budgets, spending and activities while uncertainty prevails in oil and gas markets.

“Tidewater previously announced the suspension of its quarterly dividend and common stock repurchase program and the realignment of its operating structure. These and other steps have been taken to enhance liquidity, reduce costs and reduce capital expenditures, all to best position the company for an eventual industry recovery,” Platt said in a release.

“We are in compliance with all financial covenants and other terms of the revolving credit facility and our note indentures. This is a predicate to our being able to draw on the revolving credit facility.”

Tidewater said “possibly as early as fiscal 2017” it may cease to be compliant with the interest coverage ratios of some of its debt facilities and senior note indentures.

The New Orleans-based company said it is in discussions with its principal lenders and noteholders to amend or waive these covenants before such a default or covenant breach occurs. “Obtaining the covenant relief the company is seeking will require the company to successfully harmonize the interests of the banks and the noteholders,” it said of the road ahead.

A recent ruling by the World Bank means Tidewater could soon receive more than half of the multimillion-dollar payout it is due from the Venezuelan government – although if or when the award will be remitted looks uncertain.

The firm is due an undisputed amount of $37.2m (including interest) as compensation for having 11 of its vessels seized and nationalised in 2009 by Venezuela while its late president Hugo Chavez was in office.

Holly Birkett

Holly is Splash's Online Editor and correspondent for the UK and Mediterranean. She has been a maritime journalist since 2010, and has written for and edited several trade publications. She is currently studying for membership of the Institute of Chartered Shipbrokers. In 2013, Holly won the Seahorse Club's Social Media Journalist of the Year award. She is currently based in London.

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