Fracking Services Company Files for Chapter 11
Hi-Crush Inc has revealed that it has voluntarily filed petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of Texas.
The company made the filings to implement the terms of a restructuring support agreement it has entered into, Hi-Crush outlined. This agreement is said to be with certain noteholders collectively owning or controlling approximately 94 percent of the aggregate outstanding amount of the company's 9.5 percent senior unsecured notes due 2026.
The terms of the agreement provide for a comprehensive restructuring of the company's balance sheet to be implemented through the commencement of Chapter 11 cases, according to Hi-Crush. The company said the prearranged plan, if implemented, will result in the elimination of approximately $450 million of unsecured note debt and an ongoing reduction in annual interest expense of greater than $43 million.
Hi-Crush said that during the Chapter 11 proceedings, the company will continue to operate its business in the normal course without disruption to its vendors, customers, or employees, and added that it will have sufficient liquidity to meet its financial obligations during the restructuring process.
“We are very pleased to have reached this agreement with our various lenders,” Robert E. Rasmus, chairman and chief executive officer of Hi-Crush, said in a company statement which was posted on Hi-Crush’s website.
“The agreement will allow Hi-Crush to maintain normal operations and continue delivering high quality services to our customers. We will also significantly improve our balance sheet and enhance our company's financial flexibility over the near and long-term,” he added.
“We expect to emerge from this process in an even stronger market position, with an enhanced ability to execute on our operational strategy and grow our business over the long-term,” Rasmus continued.
Hi-Crush describes itself as a fully-integrated provider of proppant and logistics services for hydraulic fracturing operations. The business offers frac sand production, advanced wellsite storage systems, flexible last mile service and innovative software for real-time visibility and management across the entire supply chain, according to its website.
To contact the author, email email@example.com
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.