HOUSTON – Oilfield service company McDermott International, based in Houston but an employer of thousands in Louisiana, announced plans to begin a prepackaged Chapter 11 bankruptcy protection process.
The company said the plan is supported by more than two-thirds of all funded debt creditors and will eliminate more than $4.6 billion in debt.
“The restructuring transaction, which has the full support from all of our funded creditors, including our unsecured bondholders, is further recognition of McDermott’s fundamentally solid operating business and proven strategy,” said David Dickson, president and chief executive officer of McDermott. “Our record backlog, the majority of which has been booked in the last two years, and high rate of new project awards demonstrates our customers’ continued confidence in our business, the demand for our skills and our long-term opportunities ahead.
“This financial restructuring will create a sustainable capital structure that matches the strength of our operating business. As a result of the transaction, we are eliminating over $4.6 billion in debt from our balance sheet and we will emerge with robust liquidity and significant financing to execute on customer projects in our backlog. Throughout this process, which we expect to complete expeditiously, McDermott will continue all business operations as normal and deliver on our commitments to our customers.”
As a result of the upcoming Chapter 11 filing, McDermott expects to be delisted from the New York Stock Exchange within the next 10 days. McDermott common stock will continue to trade in the over-the-counter marketplace throughout the Chapter 11 process. The shares are proposed to be cancelled as part of McDermott’s restructuring.
