Financial Advisory
Slaughterandmay
Full Credential Description
Seadrill Limited faced significant financial challenges, necessitating a comprehensive restructuring through a Chapter 11 plan of reorganization. The primary issue was a heavily leveraged balance sheet, with approximately $4.9 billion in secured bank debt spread across twelve silos. This complex debt structure hindered operational flexibility and growth potential in the offshore drilling sector. To address these challenges, Slaughter and May provided tailored legal counsel, facilitating negotiations that led to a successful restructuring. The plan effectively equitized the substantial bank debt, resulting in a streamlined capital structure with a single collateral silo. Additionally, Seadrill secured $350 million in new financing as part of the restructuring, enhancing its liquidity position. The restructuring also had a significant impact on existing shareholders, who saw their holdings reduced to just 0.25%, while employee, customer, and ordinary trade claims remained unaffected. The restructuring process involved extensive discussions and was approved by the US bankruptcy court on October 26, 2021, following strong support from stakeholders. This strategic overhaul not only alleviated Seadrills debt burden but also positioned the company to pursue new opportunities and drive value for its stakeholders in the competitive offshore drilling market. The collaborative effort included contributions from Seadrills in-house legal team and other law firms, ensuring a comprehensive approach to the complex legal and financial issues at hand.