Oilfield companies agency Weatherford to file for Chapter 11 chapter
Oilfield companies supplier Weatherford International Plc, burdened by a heavy debt load and years of losses, mentioned on Friday it might file for Chapter 11 chapter safety.
The firm, which at its peak was valued at greater than $50 billion, by no means recovered from the 2014 oil worth collapse. Efforts below Chief Executive Officer Mark McCollum to shortly promote property and pare debt struggled.
Weatherford expects to cut back its long-term debt by greater than $5.eight billion, via the restructuring.
Weatherford’s shares plunged 61% to 14 cents in prolonged buying and selling on Friday after the corporate reported the plan to hunt safety from collectors and a wider quarterly loss.
For the interval ended March 31, it posted a lack of $481 million, or 48 cents a share, in contrast with a lack of $245 million, or 25 cents, a yr earlier. Revenue fell 5.four p.c to $1.35 billion.
Rising losses had left Weatherford with out entry to appropriate financing and sparked the departure of key workers, it mentioned in a securities submitting. It did not hit first quarter price discount targets as a result of “market headwinds” and difficulties slicing its manufacturing operations, it mentioned.
Weatherford offers oil-and-gas effectively development and completion, drilling and analysis, and manufacturing companies. It had about 26,000 workers on the finish of March.
When requested on an earnings name in February if it was contemplating submitting for chapter safety, McCollum, the previous finance chief of rival Halliburton, mentioned, “I don’t waste a number of time considering or planning methods to fail.”
Weatherford reported whole liabilities of $10.6 billion and property of $6.52 billion on March 31. It has not reported a quarterly revenue in 4 years.
The firm mentioned it expects to enter into two processes of debtor-in-possession financing, together with a revolving credit score facility of as much as $750 million offered by banks or different lenders and a mortgage facility of as much as $1 billion.
Weatherford mentioned it’s going to proceed working its companies with none disruption to its clients and different companions.