Seadrill Ltd. announced today (effective date) that it has emerged from Chapter 11 after completing its reorganization plan. Seadrill's Chapter 11 reorganization plan was confirmed by the U.S. Bankruptcy Court for the Southern District of Texas on Oct. 26, 2021.
The restructuring significantly delevered the company’s balance sheet by equitizing approximately $4.9 billion of secured bank debt previously held across 12 silos, resulting in a streamlined capital structure with a single collateral silo. Seadrill also raised $350 million in new financing pursuant to the plan. Holders of existing shares in the company’s predecessor, Seadrill Limited, were reduced to 0.25% of their existing holdings, while the company’s employee, customer, and ordinary trade claims were unaffected by the restructuring.
Stuart Jackson, CEO of Seadrill, commented: “Our emergence from Chapter 11 concludes the realignment of our balance sheet. I am grateful to all our employees, customers, partners, suppliers, creditors and shareholders for their support through this long process.
“Our restructured balance sheet provides us greater liquidity and lower debt leverage. With this firm financial footing established and market recovery well underway, Seadrill will focus on disciplined capital investment, cost containment, and contract risk management to maintain its position as a leader in the reshaping of the industry.”
The figures presented below highlight key financial metrics as of the effective date:
- Total cash of $486 million, inclusive of $151 million of restricted cash
- $300 million of first-lien new-money debt, comprised of a $175 million term loan facility and an undrawn $125 million revolving credit facility
- $683 million of second-lien takeback debt
- $50 million of unsecured convertible bonds
- Common shares issued of approximately 50 million as described further below.
Subject to certain approvals, the company expects that the new common shares will be listed on the Euronext Expand market in Oslo with a subsequent uplisting to the main market of the Oslo Stock Exchange (OSE) and the New York Stock Exchange (NYSE).
Approximately 50 million new common shares were issued as of the effective date and remain outstanding. The shares are allocated as set forth below, in accordance with provisions of the plan:
- 83% of thenew common shares issued to holders of credit agreement claims against the company and certain of its Chapter 11 debtor affiliates;
- 16.75% of thenew common shares issued to rights offering participants and backstop parties under the plan; and
- 0.25% of thenew common shares issued to holders of existing shares in the company’s predecessor.
Subject to certain approvals, the company expects that trading in thenew common shares on Euronext Expand will commence in the second quarter.
Seadrill, Hamilton, Bermuda, is an offshore drilling contractor that utilizes advanced technology to unlock oil and gas resources for customers across harsh and benign locations across the globe. Seadrill’s technologically advanced fleet spans all asset classes allowing it to conduct its operations from shallow to ultradeepwater environments. The company owns and/or operates 35 rigs, which includes drillships, jackups and semisubmersibles.
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