Offshore driller Valaris to explore bankruptcy with its creditors-sources



April 21 (Reuters) - Offshore oil driller Valaris PLC is preparing to start talks with creditors to see if they can agree on terms for a possible bankruptcy filing, as it grapples with a $6.5 billion debt burden and an unprecedented plunge in U.S. crude prices, people familiar with the matter said on Tuesday.

Reuters reported last month that the London-based company was working with debt restructuring advisers as it struggled to cope with a rig accident and falling energy prices.

Since then, U.S. crude futures have traded in negative territory for the first time in history amid a supply glut and a collapse in demand brought about by the coronavirus outbreak, putting further pressure on the company’s customers, which are mainly large oil companies.

Valaris, which employs about 5,800 people worldwide, in recent weeks hired corporate restructuring experts at turnaround firm Alvarez & Marsal, the sources said.

The sources requested anonymity because the deliberations are confidential. Valaris and Alvarez did not respond to requests for comment.

U.S. President Donald Trump on Tuesday directed federal officials to formulate plans for steering money to U.S. oil and gas companies, underscoring the turmoil’s severity on the industry.

Valaris, formed a year ago through the merger of Ensco and Rowan Companies, plans to attempt negotiations with creditors to gain support for a restructuring plan before a bankruptcy filing, the sources said.

Known in restructuring circles as a prearranged or prepackaged bankruptcy, such a deal could limit the time Valaris spends navigating court proceedings, the sources added.

Any bankruptcy filing is still weeks or months away, the sources said. Valaris could also try to restructure its debt outside of court proceedings and avoid bankruptcy, though corralling enough creditors to do so would be challenging, one of the sources added.

Debt restructuring experts at law firm Kirkland & Ellis LLP and investment bank Lazard Ltd have also been advising Valaris, Reuters previously reported.

S&P Global downgraded the company’s credit rating deep into junk territory on Monday, pushing up its borrowing costs. The credit ratings firm said the move reflected the offshore oil driller’s unsustainable debt, deteriorating liquidity and high likelihood it will restructure its finances.

Valaris had roughly $1.7 billion of liquidity at the end of 2019, about $100 million of it in cash and the rest available under a credit line. It faces a $123 million debt maturity this year, in addition to about $400 million in estimated interest expenses, ratings firm Moody’s Investors Service Inc said in March.

Valaris also plans to spend up to $160 million this year, including on idle drilling rigs that are not bringing in revenue, according to Moody’s. Valaris unsecured bonds trade at less than 20 cents on the dollar, according to S&P, reflecting creditors’ concerns about repayment.

Valaris earlier this year reported an accident that damaged one of its rigs off the coast of Angola. As a result, France’s Total SA terminated its contract with the rig, which was among Valaris’s most lucrative. (Reporting by Mike Spector and David French in New York Editing by Marguerita Choy)


위는 기사 내용입니다. 대충 요약하자면,

VAL은 파산신청이 가능한지 전문가와 상의할 예정이다, 하지만 그 이전에 부채를 줄이기 위해 구조조정을 먼저 한 다음 파산신청을 할것이다.(가급적 파산을 회피하려고 함).

하지만 여전히 채권자를 모으기는 어려우며, 신용등급까지 낮아져 차입이 더 어려워졌다.

2019년 말 기준으로, 17억달러의 유동성이 있고 그중 1억달러가 현금.

3월의 금리가 4억정도, 올해의 부채만기가 1억달러정도.

시추장비에 대한 고정비용으로 1억6천만 달러가 지출..