Offshore driller Valaris is planning to emerge from chapter 11 early next quarter after it received approval from the US Bankruptcy Court for its prearranged plan of reorganisation.
The plan has also received support from approximately 80% of the company’s unsecured noteholders and bank lenders representing 100% of the company’s credit facility claims. Additionally, around 81% of the company’s voting shareholders voted in favour of the plan.
Tom Burke, president and CEO of Valaris, commented: “I am pleased that we have received strong support for the Company’s amended plan. This is an important milestone, as it clears the path for Valaris to emerge from chapter 11 early in the second quarter. The overwhelming support from our noteholders and bank lenders shows their confidence in our go-forward strategy and strength as a company.
“This achievement would not have been possible without the continued dedication and loyalty from our employees, customers, vendors and other partners. We look forward to emerging swiftly with our strengthened capital structure which, combined with our high-quality rig fleet and personnel, positions the company well in a still challenging offshore drilling market.”
Valaris filed for chapter 11 in August 2020 in order to implement the plan, which will see it eliminate $7.1bn of existing debt, while also receiving a $520m capital injection through the issuance secured notes.
Valaris has also reached an agreement with South Korea’s DSME to amend its two newbuild drillship contracts. The delivery date has been extended to December 31, 2023, and also gives Valaris the option to take delivery early or terminate the contracts on a non-recourse basis.