Prosafe strikes a deal with lenders over restructuring plan
Following an agreement with lenders over its financial restructuring plan, offshore accommodation rig provider Prosafe expects to reduce its debt significantly and improve the balance sheet and financial flexibility.
Prosafe presented its business plan and a restructuring proposal to its lenders last year and, in the meantime, continued to operate on a going concern basis while working on an agreement for a long-term financial solution with lenders.
The company has now received support from lenders of Prosafe SE and Prosafe Rigs on a comprehensive and material restructuring of the financial indebtedness of the group.
The company informed on Friday it has received acknowledgement of credit approval, which is subject to certain conditions, in support of the transaction from ca. 79 per cent across the $1.3 billion facility and the $144 million facility with additional credit approvals expected by mid-June 2021.
The terms of the transaction will result in significant de-leveraging of the balance sheet with ca. 75 per cent debt reduction, a corresponding reduction in annual debt service, a sufficient cash balance and in sum a significantly improved balance sheet and improved financial flexibility.
Jesper K. Andresen, Prosafe CEO said, “The support for a comprehensive restructuring from our lenders is a key milestone in the process to implement a sustainable financial solution. We are pleased to have achieved this consensually among our lenders which reflects the strong support we have enjoyed from them throughout the process and which has enabled us to continue our business as usual and protect and generate value.
“Pending remaining credit approvals and a possible Singapore Scheme of Arrangement combined with other arrangements to complete the implementation, Prosafe will continue to position the company and focus on protecting and creating value for all its stakeholders”.
Namely, to the extent Prosafe does not receive unanimous support for the restructuring from all stakeholders, the company intends to implement the transaction using a Singapore Scheme of Arrangement combined with other arrangements if required.
The transaction will also require approval from the company’s shareholders in an extraordinary general meeting.