Offshore Driller Pacific Drilling Emerges from Bankruptcy

pacific drilling
Photo: Pacific Drilling

Offshore drilling contractor Pacific Drilling announced Monday it has emerged chapter 11 bankruptcy after successfully completing a more than a year-long reorganization.

As a result, Pacific Drilling has raised $1.5 billion in gross proceeds in new capital, consisting of $1.0 billion of new secured notes and $500 million of equity.

Under the reorganization plan, the company turned into equity approximately $1.85 billion in pre-petition debt associated with the Company’s Term Loan B, 2017 Notes and 2020 Notes, and paid in full approximately $1.2 billion of debt related to its pre-petition senior secured credit facility, revolving credit facility and the post-petition debtor-in-possession financing.

Customer, employee and ordinary trade claims were unimpaired.

“The [reorganization plan] has strengthened the Company’s balance sheet by significantly reducing its leverage and enhancing its liquidity, with approximately $400 million in cash upon emergence and no debt maturities until late 2023, positioning the Company to take advantage of its dedicated, high-specification deepwater drillship fleet in anticipation of an improving market for offshore drilling services,” Pacific Drilling said in statement. 

As a result of the reverse stock split and the issuances of common shares, the company now has approximately 75.0 million shares outstanding. 

Shares prior to Pacific Drilling’s restructuring have diluted to just 0.003% of the company’s current outstanding shares. 

Furthermore, in accordance with the restructuring plan, a newly constituted Board of Directors has been appointed appointed, consisting of W. Matt Ralls (Chairman), Bernie G. Wolford Jr. and David Weinstein as Class A Directors and Daniel Han, Donald Platner and Kiran Ramineni as Class B Directors.

In addition, the company has also announced that Bernie G. Wolford Jr. has been appointed Chief Executive Officer, effective immediately. Wolford succeeds Paul T. Reese, who served as Chief Executive Officer of the Company since August 2017.

“On behalf of the Board and the entire Company, I want to thank Paul for his service and contributions to the Company, especially during the reorganization. We wish him the very best in his future endeavors,” said W. Matt Ralls, Chairman of the Company’s Board of Directors.

With its principal offices in Luxembourg and Houston, Pacific Drilling’s fleet of consists seven highly-advanced drillships.