McDermott Takes Action to De-Lever its Balance Sheet and Immediately Position Company for Long-Term Growth

 

  • Financial restructuring transaction supported by more than two-thirds of all funded debt creditors
  • Transaction to equitize nearly all funded debt; company to emerge with committed letter of credit financing and only $500 million of funded debt
  • Restructuring to be implemented through prepackaged Chapter 11 process on expedited schedule with the support of $2.81 billion debtor-in-possession financing
  • Customer projects to continue seamlessly; all operations continue in normal course
  • Plan provides that all suppliers will continue to receive payments and be paid in full
  • Enters agreement to sell Lummus Technology to The Chatterjee Group and Rhône Group for $2.725 billion, subject to higher or otherwise better bids received through a court-supervised auction process

On January 21, 2020, McDermott International, Inc. announced that it has the support of more than two-thirds of all its funded debt creditors for a restructuring transaction that will equitize nearly all the company’s funded debt, eliminating over $4.6 billion of debt. McDermott commenced solicitation of votes from its lenders and bondholders in support of a prepackaged Chapter 11 Plan of Reorganization and commenced the prepackaged Chapter 11 filing later in the day, on January 21, 2020 in the U.S. Bankruptcy Court for the Southern District of Texas.
 
Read the full announcement here.
 
The restructuring transaction will create a sustainable capital structure that matches the strength of McDermott’s operating business, and McDermott expects to emerge a stronger, more competitive company with a solid financial foundation to build upon its reputation as a premier, fully integrated provider of technology, engineering and construction solutions to the energy industry.
 
All of McDermott’s businesses will continue to operate as normal and are anticipated to continue to do so for the duration of the restructuring process, which the Company expects to complete expeditiously. The Company plans to uphold its commitments to its customers, employees and other stakeholders during the process and beyond. McDermott expects to continue to pay employee wages and health and welfare benefits, and to pay all suppliers in full. All customer projects are expected to continue uninterrupted on a global basis.
 
Once McDermott initiates the Chapter 11 filing, more information about the restructuring, including access to court documents, can be found by visiting https://cases.primeclerk.com/McDermott or contacting Prime Clerk, the company’s noticing and claims agent at +1 877-426-7705 (for toll-free US domestic calls) and +1 917-994-8380 (for tolled international calls) or McDermottInfo@primeclerk.com.

 

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