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https://www.worldoil.com/news/2019/7/3/weatherford-files-for-chapter-11-bankruptcy
Weatherford files for Chapter 11 bankruptcy
7/3/2019
BAAR -- Weatherford International plc, Weatherford International Ltd., and Weatherford International, LLC, announced that the Company has initiated its previously-announced financial restructuring by commencing voluntary cases under Chapter 11 of the U.S. Bankruptcy Code to effectuate its "pre-packaged" Plan BAof Reorganization. The Company's other entities and affiliates are not included in the Chapter 11 Cases. Weatherford also expects to file Bermuda and Irish examinership proceedings (collectively with the Chapter 11 Cases, the "Cases") in the coming months. The comprehensive financial restructuring would significantly reduce the Company's long-term debt and related interest costs, provide access to additional financing and establish a more sustainable capital structure.
The Company has received commitments from lenders for $1.75 billion of debtor-in-possession financing (the "DIP Facility"). The proceeds of the DIP Facility will be available to fund the Company's working capital needs throughout the Cases. Additionally, upon exit from bankruptcy the Company will have access to additional financing in the form of (a) an undrawn first lien exit revolving credit facility in the principal amount of up to $1.0 billion, and (b) up to $1.25 billion of new tranche A senior unsecured notes with a five-year maturity. In addition, on emergence from bankruptcy the Company will issue $1.25 billion of new tranche B senior unsecured notes with a seven-year maturity to holders of the Company's existing unsecured notes.
Business as usual
The Company has filed "first day" motions to obtain the requisite court authority for the Company to continue operating its businesses and facilities in the ordinary course without disruption to its customers, vendors, partners or employees. The Company is working to complete all necessary milestones and will disclose details regarding planned emergence in due course.
https://www.bizjournals.com/houston...herford-files-8-3b-bankruptcy-in-houston.html
Weatherford files $8.3B bankruptcy in Houston
EnlargeMark McCollum, president and CEO of Weatherford International
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By Olivia Pulsinelli – Senior web editor, Houston Business Journal
Jul 1, 2019, 5:12pm CDT Updated Jul 2, 2019, 11:47am EDT
Weatherford International PLC (NYSE: WFT), which has its main U.S. office in Houston, filed for Chapter 11 bankruptcy protection on July 1, as was expected.
The oil field services company listed total debts of nearly $8.34 billion and total assets of nearly $6.52 billion, according to court filings. Weatherford also filed "first day" motions to allow it to continue operating without disruption to its customers, vendors, partners or employees, according to a July 1 press release. Only three Weatherford entities filed for Chapter 11, and the company also expects to file Bermuda and Irish examinership proceedings in the coming months, the release notes.
Weatherford executed a restructuring support agreement with some creditors in May with plans to implement it through a prepackaged Chapter 11 process. The company said at the time that the agreement would eliminate more than $5.8 billion of the company's debt. On June 28, the company informed the U.S. Securities and Exchange Commission that the Chapter 11 case was expected to commence July 1.
The holders of about 79 percent of Weatherford's outstanding senior unsecured notes had agreed to the restructuring support agreement as of June 28, according to an SEC filing. Nearly $7.43 billion of Weatherford's debt is attributed to those prepetition notes.
Weatherford has received commitments for about $1.75 billion of debtor-in-possession financing, per the release. Once Weatherford completes its restructuring and exits bankruptcy, the company is expected to have $1 billion of secured funded indebtedness and a $500 million letter of credit from its exit facility as well as up to $2.5 billion of unsecured funded indebtedness from new senior unsecured notes, according to the disclosure statement and prepackaged plan of reorganization filed with the SEC. In May, Weatherford said the restructuring support agreement includes the possibility to reduce at least some of those amounts.
Weatherford cited the current state of the oil and gas industry as the primary factor leading to the company's Chapter 11 filing, per the disclosure statement.
"The decline in the price of oil and gas and the resulting adverse market conditions have severely impacted Weatherford affecting, among other things, the company’s cash flow, borrowing capacity, and ability to service its outstanding indebtedness," the disclosure statement notes. "As with many of their peers, this drastic and prolonged drop in oil and gas prices has strained the company’s liquidity for an extended period of time.
"The company took several steps to try to address its capital structure and liquidity needs without a comprehensive in-court restructuring before commencing these Chapter 11 cases. The company and its management team focused on cutting costs, reducing capital expenditure, and managing liquidity."
A global restructuring in the fourth quarter of 2018 eliminated about 900 jobs and created annualized savings of about $114 million, per the disclosure statement. As previously reported, the company also made some multimillion-dollar asset sales.
"Despite several successful strategic divestitures, the company remained overleveraged, with debt service payments hampering its ability to use the proceeds of these divestitures to invest in the business and (its) new initiatives," the disclosure statement notes.
Shortly after Weatherford disclosed in May that it intended to file for bankruptcy, the New York Stock Exchange began delisting the company's stock. That move came sooner than expected due to the impending bankruptcy, and Weatherford said at the time that it planned to appeal the NYSE's decision.
When the NYSE warned Weatherford in December that it was at risk of being delisted, Weatherford said it intended “regain compliance by completing its previously announced companywide transformation plan designed to improve its 2017 EBITDA run-rate by an incremental $1 billion by year-end 2019.”
One expert recently told the Houston Business Journal he expects to see more upstream energy companies — and, thus, their oil field services counterparts — file for bankruptcy this year.
Weatherford has tapped Lazard to act as financial adviser, Latham & Watkins LLP as legal counsel and Alvarez & Marsal as restructuring adviser, per the release. Hunton Andrews Kurth LLP is representing Weatherford as co-debtors counsel, according to the firm. Evercore is acting as financial adviser for the group of the company's senior noteholders, and Akin Gump Strauss Hauer & Feld LLP is the group's legal counsel.
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https://www.reuters.com/article/us-...-file-for-chapter-11-bankruptcy-idUSKCN1SG2IW
months ago
Oilfield services firm Weatherford to file for Chapter 11 bankruptcy
3 Min Read
(Reuters) - Oilfield services provider Weatherford International Plc, burdened by a heavy debt load and years of losses, said on Friday it would file for Chapter 11 bankruptcy protection.
The company, which at its peak was valued at more than $50 billion, never recovered from the 2014 oil price collapse. Efforts under Chief Executive Officer Mark McCollum to quickly sell assets and pare debt struggled.
Weatherford expects to reduce its long-term debt by more than $5.8 billion, through the restructuring.
Weatherford’s shares plunged 61% to 14 cents in extended trading on Friday after the company reported the plan to seek protection from creditors and a wider quarterly loss.
For the period ended March 31, it posted a loss of $481 million, or 48 cents a share, compared with a loss of $245 million, or 25 cents, a year earlier. Revenue fell 5.4 percent to $1.35 billion.
Rising losses had left Weatherford without access to suitable financing and sparked the departure of key employees, it said in a securities filing. It failed to hit first quarter cost reduction targets due to “market headwinds” and difficulties cutting its manufacturing operations, it said.
Weatherford provides oil-and-gas well construction and completion, drilling and evaluation, and production services. It had about 26,000 employees at the end of March.
When asked on an earnings call in February if it was considering filing for bankruptcy protection, McCollum, the former finance chief of rival Halliburton, said, “I don’t waste a lot of time thinking or planning how to fail.”
Weatherford reported total liabilities of $10.6 billion and assets of $6.52 billion on March 31. It has not reported a quarterly profit in four years.
The company said bit.Iy/2VvvO5y it expects to enter into two processes of debtor-in-possession financing, including a revolving credit facility of up to $750 million provided by banks or other lenders and a loan facility of up to $1 billion.
Weatherford said it will continue operating its businesses without any disruption to its customers and other partners.
Reporting by Arathy S Nair in Bengaluru and Gary McWilliams in Houston; Editing by Cynthia Osterman and Rosalba O'Brien
https://www.reuters.com/article/us-...rnational-files-bankruptcy-plan-idUSKCN1TT33N
Oilfield firm Weatherford International files bankruptcy plan
1 Min Read
(Reuters) - Oilfield services firm Weatherford International [WFTIF.PK] on Friday filed a prepackaged restructuring plan with the U.S. Securities and Exchange Commission, according to a regulatory filing.
The company, which has struggled under a heavy debt burden and years of losses, warned in May that it expected to seek Chapter 11 bankruptcy protection after failing to obtain new financing and after the loss of key employees.
Holders of roughly 79% of its outstanding notes have agreed to the restructuring, according to Friday’s filing.
The proposed restructuring will reduce the firm’s funded debt from roughly $8.35 billion to $2.5 billion, according to the disclosure. Debt holders will receive about a 99% stake in the company that emerges from Chapter 11, according to the filing.
The Chapter 11 case is anticipated to begin on Monday, with the first hearing as early as Tuesday, the filing said.
Reporting by Liz Hampton; Editing by Tom Brown
