Friday, May 26, 2017

Seadrill Bond Traded at 33 Cents

The Seadrill bond that's due in September traded at 33 cents today.

Comment from the earnings call this week:

"In April, we reached agreement with our bank group to extend the restructuring plan negotiating period until the 31st of July, reflecting significant progress made. We are currently in advance discussions with third parties and related party investors and our secured lenders on the terms of the comprehensive recapitalization.

We've received a new money proposal from third-party and related party investors, which remains subject to further negotiation, final due diligence and documentation. We are also in discussions with certain bondholders who have recently become restricted again. I appreciate you're all interested to understand more details on the restructuring, but at this stage, it would be inappropriate for us to comment on specifics. As you're aware, this is a large and complex transaction with multiple parties involved.

While discussions with our secured lenders and certain investors have advanced significantly, a number of important terms continue to be negotiated. And until such time an agreement is reached, no assurances can be given.

We continue to believe that implementation of a comprehensive restructuring plan will likely involve schemes of arrangement for Chapter 11 proceedings. It is likely that the comprehensive restructuring plan will require substantial impairment or conversion of our bonds as well as impairment and losses for other stakeholders. As a result, we currently expect that shareholders are likely to receive minimal recovery for their existing shares."

3 comments:

Rob Dawg said...

33¢? That seems a tad excessive for $100 face value. Are you sure you put the decimal in the right place?

Anonymous said...

33 cents means 33 cents on the dollar

Anonymous said...

Are you following the SHLD situation? Appears July could be a pivotal month for the company.