Offshore driller Noble Corporation has sealed a restructuring support agreement with two groups of its largest holders of outstanding bond debt for a consensual financial restructuring transaction that will be completed under Chapter 11.
The agreement will see the elimination of Noble’s $3.4bn in bond debt, with bondholders also agreeing to invest $200m of new capital. Noble is expected to emerge with an enhanced liquidity position supported by a new $675m secured revolving credit facility, provided by its current syndicate of revolving credit facility lenders.
To implement the restructuring, Noble and selected subsidiaries have filed for relief under chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas. The restructuring is expected to be confirmed and completed in time for Noble to emergence from chapter 11 before the end of the year.
Robert Eifler, president and CEO of Noble Corporation, commented: “Along with many other businesses in our industry, Noble has been affected by the severe downturn in commodity prices which has been compounded by the Covid-19 pandemic. After many months exploring our strategic options, we concluded that a substantial deleveraging transaction implemented through a Chapter 11 filing, supported by our largest creditors, provides the best outcome for Noble and our stakeholders. Our improved balance sheet and liquidity position will enable us to further invest in our assets, customer relationships and our people. I would like to personally thank our employees for their continued dedication, as well as all of our customers and service providers for their support and partnership. We remain committed to the world class operational excellence, safety and environmental stewardship that defines Noble.”
Noble says that it has sufficient funds to continue its worldwide operations and will operate as normal during the restructuring, and will continue to pay employee wages and benefits as well as vendors.