Tidewater in Trouble

Photo: Captain's Voyage
Photo: Captain’s Voyage

New Orleans-based OSV company Tidewater Inc. has been given just three more weeks to reach a deal with its lenders and bondholders before it will be forced to consider other options including Chapter 11 bankruptcy.

The precarious news was revealed Friday when Tidewater announced it had received only limited waivers from lenders and noteholders to extend the deadline for a deal to until November 11, 2016. The deadline was extended from Oct. 21 and earlier from Sep. 18. 

With more than 300 vessels, Tidewater has one of the biggest OSV fleets in the offshore oil and gas industry. 

Tidewater Inc. (NYSE: TDW) has been in discussions with its principal lenders and noteholders to amend the company’s various debt arrangements to obtain relief from certain covenants. The company previously reported that progress was being made in those negotiations, however Tidewater now admits that due to the projected weak activity in offshore drilling, a key driver within the offshore service vessel (OSV) industry, more negotiations are needed.

“While the company will continue to work toward amendments to its various debt arrangements that will be acceptable to all parties, there is a possibility that the lenders, noteholders and the company will not be able to negotiate new debt terms that are acceptable to all parties, in which case the company will have to consider other options, including a possible reorganization under Chapter 11 of the federal bankruptcy laws.”

Tidewater Inc. shares were trading down 44% by the end of the day Monday at $1.67.