CGG Looks to Restructure Debt as ‘Very Difficult Market’ Bites

French seismic survey specialist, CGG, said on Thursday it intends to start discussions with all the stakeholders in order to achieve a financial restructuring.

As CGG considers its debt level to be too high, the objective of this restructuring would be to provide the company with a level of indebtedness and cost of debt that is substantially reduced and sustainably adapted to its revenues.

The company estimates its multi-client sales at circa $135 million in the fourth quarter of 2016, with a level of prefunding in line with target but an after-sales volume below its expectations. At the Group level, Q4 revenues are expected to be the highest quarterly revenues of the year 2016.

Net debt should amount to circa $2.315 billion as at December 31, 2016, CGG noted.

CGG added that in order to facilitate discussions with all stakeholders, it wishes to have the ability to request the appointment of an ‘ad hoc representative’ (Mandataire ad hoc), which requires the agreement of the relevant creditors.

Jean-Georges Malcor, CEO, CGG, said: “After the effective execution of our industrial Transformation Plan and in market conditions that are expected to remain very difficult, our priority is now to improve our balance sheet and quickly restore financial flexibility to the company. At the same time, we remain fully committed to our commercial efforts, customer satisfaction, operational excellence, strict cost management and preservation of our liquidity level.”