Stakeholders of offshore drilling contractor Seadrill have overwhelmingly accepted the company’s plan of reorganization, paving the way the company to emerge from Chapter 11 bankruptcy by the end of the year assuming the plan is accepted by the court.
In an update on Monday, Seadrill said all voting classes of stakeholders accepted the reorganization plan, including all 12 credit facilities and general unsecured creditors and shareholders. Over 96% of secured lenders voted, and over 88% of secured lenders accepted the plan.
Based on the results, Seadrill is on track to have its reorganization confirmed at a confirmation hearing scheduled for later this month. If confirmed by the court, Seadrill is targeting exiting chapter 11 proceedings approximately 60 days thereafter, subject to certain customary conditions, including certain antitrust approvals.
“The near-unanimous acceptance of the Plan by our lenders is another important step towards Seadrill’s emergence from chapter 11,” said Grant Creed, Seadrill’s CFO. “This has been a long journey to deliver broad support across our creditor constituency, but I am confident that our eventual emergence will place us back at the heart of a sector collectively going through significant re-adjustment and reinforce our position as a market leader.”
Sedrill operates a fleet of 42 offshore drilling rigs, which includes drillships, jack-ups and semi-submersibles. The company filed for Chapter 11 bankruptcy for the second time in four years back in February as part of a balance sheet restructuring to restructure over $7 billion in debt. The plan that has now been accepted, a debt/equity swap, leaves existing shareholders, including Norwegian billionaire John Fredriksen, with approximately 0.25% equity in the company going forward.
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