Embattled French offshore services group Bourbon is reviewing a takeover offer from Société Phocéenne de Participation, a company owned by a group of French banks representing 75% of the Bourbon’s debt.
The offer relates to all of the Bourbon’s assets and activities and would convert €1.4 billion of debt into capital and €300 million of debt in the form of repayable bonds, as well as €150 million in bank financing.
If accepted, Bourbon Corporation would be completely liquidated, leading to a total loss notably for the shareholders and bondholders.
The Marseilles Commercial Court opened reorganization proceedings against Bourbon Corporation, a holding company, as well as its sub-holding company Bourbon Maritime back in August after the Chinese leasing company ICBC moved to redeem guarantees from Bourbon amounting to more than 800 million dollars.
Bourbon Maritime is responsible for all of Bourbon’s activities. SPP has informed the Marseilles Commercial Court that if the offer is accepted, it would become 100 percent shareholder Bourbon Maritime’s capital and present a continuation plan for the company. The plan, according to SPP, has already received support from 75 percent of Bourbon’s creditors.
In terms of corporate governance, the SPP’s proposal provides Bourbon with a Supervisory Board composed of 8 to 10 members, as well as a Management Board composed of Gaël Bodénès, Chairman, and Thierry Hochoa.
“The court’s decision, if it were to favor the SPP’s offer, would lead to the liquidation of the listed company BOURBON Corporation and a total loss for shareholders and bondholders,” said Jacques de Chateauvieux, Chairman and CEO. “It would make BOURBON Maritime’s new shareholders responsible for the recovery of a French company, which is still the world leader in offshore oil and gas marine services, its future development and the preservation of its decision-making centers in France.”
The reorganization proceedings concern only the holding companies Bourbon Corporation and Bourbon Maritime, and not the operating companies, which have continued normal business operations. The proceedings essentially freeze Bourbon’s liabilities for a specified time, giving Bourbon time to present a plan to continue its activities by reorganizing its debt in order to ensure its recovery.
“The objective of BOURBON Corporation and BOURBON Maritime is to preserve the Group’s operating activities in order to actively participate in the emerging recovery of a profoundly changing market,” Bourbon said in August upon announcing the proceedings.
The Marseilles Commercial Court is expected to make a ruling on the offer on December 23, 2019.