Oilfield Service Firm Seventy Seven Energy Files for Bankruptcy
June 7 (Reuters) - Oilfield services company Seventy Seven Energy Inc filed for a prepackaged Chapter 11 bankruptcy on Tuesday to carry out a plan to convert $1.1 billion of its debt into equity in a reorganized company.
Seventy Seven offers drilling and hydraulic fracturing services and was spun out of Chesapeake Energy Corp in 2014. The company said its creditors have already voted overwhelmingly in favor its plan, a process known as a prepackaged bankruptcy.
"The successful completion of the solicitation process and today's filing represent the next step forward in our financial restructuring," Chief Executive Officer Jerry Winchester said.
The bankruptcy comes as two years of depressed energy prices have forced scores of oil-and-gas producers into bankruptcy. Oil industry service companies have also suffered and on Monday contract drilling company Hercules Offshore Inc filed its second bankruptcy in a year.
Oklahoma City-based Seventy Seven said its suppliers would be paid in full and operational contracts will remain in place.
The company listed assets of $1.7 billion and debts of $1.8 billion, as of April 30, in documents filed in the U.S. Bankruptcy Court in Wilmington, Delaware.
The company will seek to borrow up to $100 million to help finance operations during the bankruptcy, according to court documents.
The two largest shareholders of Seventy Seven are Icahn Capital LP and BlackRock Inc, with stakes of 8.1 percent and 4.6 percent, respectively, according to court filings.
The company's plan would cancel its existing stock, which was up slightly at 7 cents in midday trade over the counter. The stock traded at more than $25 a share after it was spun off by Chesapeake.
Seventy Seven was represented by the Baker Botts law firm and retained Lazard Freres & Co as its investment banker. Alvarez & Marsal was employed as the restructuring adviser.
(Reporting by Tom Hals in Wilmington, Del.; Editing by Matthew Lewis)
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.
- Weatherford CEO's Rebound Plan Relies On Getting Smaller
- Iran Says Oil Market Is Too Tight For US Zero Exports Target
- China's Squeezed 'Teapots' Eye Petchem Path To Riches
- Baker Hughes: US Drillers Add Oil Rigs For Second Week In Three
- Venezuela Hands China More Oil Presence, But No Mention Of New Funds
- How Likely Is an All-Out War in the Middle East Involving the USA?
- Rooftop Solar Now 4th Largest Source of Electricity in Australia
- US Confirms Reimposition of Oil Sanctions against Venezuela
- EU, Industry Players Ink Charter to Meet Solar Energy Targets
- Analyst Says USA Influence on Middle East Seems to be Fading
- Russian Ships to Remain Banned from US Ports
- Brazil Court Reinstates Petrobras Chair to Divided Board
- EIB Lends $425.7 Million for Thuringia's Grid Upgrades
- Var Energi Confirms Oil Discovery in Ringhorne
- Seatrium, Shell Strengthen Floating Production Systems Collaboration
- An Already Bad Situation in the Red Sea Just Got Worse
- What's Next for Oil? Analysts Weigh In After Iran's Attack
- USA Regional Banks Dramatically Step Up Loans to Oil and Gas
- EIA Raises WTI Oil Price Forecasts
- How Likely Is an All-Out War in the Middle East Involving the USA?
- Venezuela Authorities Arrest Two Senior Energy Officials
- Namibia Expects FID on Potential Major Oil Discovery by Yearend
- Oil Markets Were Already Positioned for Iran Attack
- Is The Iran Nuclear Deal Revival Project Dead?
- Petrobras Chairman Suspended
- Oil and Gas Executives Predict WTI Oil Price
- An Already Bad Situation in the Red Sea Just Got Worse
- New China Climate Chief Says Fossil Fuels Must Keep a Role
- Oil and Gas Execs Reveal Where They See Henry Hub Price Heading
- Equinor Makes Discovery in North Sea
- Macquarie Strategists Warn of Large Oil Price Correction
- DOI Announces Proposal for Second GOM Offshore Wind Auction
- Standard Chartered Reiterates $94 Brent Call
- Chevron, Hess Confident Embattled Merger Will Close Mid-2024
- Analysts Flag 'Remarkable Feature' of 2024 Oil Price Rally