Offshore Driller Valaris Emerges from Chapter 11 Bankruptcy After Eliminating $7 Billion in Debt
Leading offshore drilling contractor Valaris Group has emerged from Chapter 11 bankruptcy having successfully completed its financial restructuring to eliminate over $7 billion in pre-petitioned debt.
Valaris’ Plan of Reorganization, which it completed on April 30, was approved and confirmed by the United States Bankruptcy Court for the Southern District of Texas on March 3, 2021. The plan strengthens the group’s balance sheet by eliminating $7.1 billion of debt and injecting $520 million in capital through the issuance of $550 million of new secured notes maturing in 2028. As of April 30, 2021, Valaris reported it had $615 million of available cash, $40 million of restricted cash and $550 million of debt.
Now based in Hamilton, Bermuda, Valaris Group emerges the restructuring with 11 drillships, five semi-submersibles and 44 jack-ups, as it’s now beginning to see early signs of a recovery in the offshore drilling market.
“Today marks an important milestone as the Company emerges from chapter 11 with a significantly strengthened capital structure. The overwhelming support of our noteholders, bank lenders and voting shareholders has been invaluable. I want to thank everyone for their continued confidence in our business,” said Tom Burke, President and Chief Executive Officer of Valaris. “The last 12 months have been challenging from many perspectives. However, I am immensely proud of our employees’ hard work and commitment over this period. Our offshore crews and shore-based staff remain focused on delivering safe, efficient and reliable drilling services to our customers.”
“In the current commodity price environment, we are beginning to see the early signs of a recovery in customer demand following the downturn caused by the COVID-19 pandemic. With the elimination of more than $7 billion of debt and an injection of significant additional capital, Valaris is best positioned to take advantage of opportunities going forward,” Burke added.
Common shares of Valaris Group commenced trading today on the New York Stock Exchange under the symbols VAL and VAL WS. Valaris’s former UK-based parent, Valaris plc, ceased trading on the OTC Pink Marketplace as of April 28, 2021.
Valaris was formed in 2019 as “Ensco Rowan” through the merger of Ensco plc and Rowan Companies plc, creating the world’s largest offshore drilling company. It later changed its named to Valaris plc beginning August 1, 2019.
Valaris Limited, parent company to Valaris Group, also announced the appointment of a new, seven-member Board of Directors. The new Board is comprised of: Elizabeth Leykum (appointed Chair of the Board); Anton Dibowitz (who joins the Board on July 1, 2021); Dick Fagerstal; Joseph Goldschmid; Deepak Munganahalli; Jay Swent; and Thomas Burke (who remains President and Chief Executive Officer).
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