LIMASSOL, Cyprus – SeaBird Exploration Plc will propose a debt restructuring of the group to its bondholders and certain of its other creditors. In its proposal presentation, the company said that it was forecasted to run out of cash in August.
“New contracts may improve this – several opportunities [are] in the pipeline; timing of these is critical. It is highly likely that a liquidity injection is required by early 3Q,” SeaBird said.
Following the restructuring,SeaBird’s debt will be reduced by $22 million and lease obligations will be reduced by $10.4 million, the company said.
The remaining debt under the SBX04 bond loan and the Glander credit facility will be a total of $5 million and the remaining lease obligations (payable in kind until maturity) will be $2.4 million.
According to the company, the restructuring comprises, among other things, the equitization of about 81.5% of outstanding indebtedness, including accrued interest of the group owed under Tranche B of the SBX04 bond loan, along with the equitization of ~81.5% of unpaid and remaining charter hire for the M/VMunin Explorer, which is owed to Ordinat Shipping AS.
The completion of the restructuring is subject to a number of outstanding conditions outside the control of the company, SeaBird noted, including the approval of the restructuring at a bondholders’ meeting in the SBX04 bond issue and at an extraordinary general meeting of the company, among others.
A summons has been dispatched for bondholder’s meeting to be held on June 6, and a summons for an extraordinary general meeting to be held around mid-June will be dispatched as soon as possible, the company noted in its presentation.
“Constructive discussions have been held over a significant period of time between the company and its restructuring advisors, and a significant number of the stakeholders whose consent to the restructuring are required. However, there are no guarantees that all consent requirements or other conditions for the restructuring will be fulfilled in an appropriate and/or timely manner,” SeaBird said in its statement.
ABG Sundal Collier ASA and Arctic Securities AS act as financial advisors to the company. Advokatfirmaet Schjødt AS acts as Norwegian legal counsel.