Offshore drilling contractor Seadrill Limited announced Monday it has emerged from chapter 11 after successfully completing its commitments under a plan of reorganization.
The restructuring plan, which was confirmed by the U.S. Bankruptcy Court for the Southern District of Texas in April, strengthens Seadrill’s balance sheet by providing over $1 billion of new capital, extending and re-profiling $5.7 billion of secured bank debt, and converting $2.4 billion of unsecured bonds to equity, while leaving employee, customer, and ordinary trade claims largely unaffected.
“The Plan has re-profiled the Company’s debt and provided substantial liquidity that puts the Company in a strong position to execute its business plan,” Seadrill said in statement on Monday.
Under the plan, the existing Seadrill Limited has been wound up and the new company with the reorganized capital structure will assume the Seadrill name and re-list on both the NYSE and Olso Stock Exchange under ticker symbols. Listing is anticipated for July 3, 2018.
Seadrill, once the world’s largest offshore driller by market value, filed for Chapter 11 bankruptcy protection in September with debt and liabilities of over $10 billion last September after a drop in oil prices in 2014 cut demand for rigs.
The plan of reorganization has received near-unanimous support from all Seadrill stakeholders including its largest shareholder, shipping tycoon John Fredriksen, who prior bankruptcy held to 24 percent of Seadrill through his personal family-fund Hemen Holdings.
As part of the plan, Seadrill will issue 100 million shares of New Common stock, of which just 1.9% will go to existing shareholders.
Also as part of the plan, a newly-constituted Board of Directors was appointed, consisting of John Fredriksen as Chairman, Harald Thorstein, Kjell-Erik Østdahl, Scott D. Vogel, Peter J. Sharpe, Eugene I. Davis, and Birgitte Ringstad Vartdal.
“We are pleased to be emerging from chapter 11 and moving forward with a solid financial foundation on which we will continue to grow and strengthen our business,” said John Fredriksen.
Anton Dibowitz, CEO of Seadrill Management, commented, “I would like to thank our customers, vendors and financial stakeholders for their continued loyalty and support throughout the restructuring process. I would also like to thank all our employees for their continued hard work and dedication during this period and whose efforts were a key part of concluding this restructuring process.”