EMAS CHIYODA Subsea Seeks Financial Restructuring Through Chapter 11

EMAS CHIYODA Subsea Seeks Financial Restructuring Through Chapter 11

28 February 2017
For immediate release

EMAS CHIYODA Subsea Limited (“ECS”), a major player in the subsea sector, announced today that ECS and certain subsidiaries (the “Company”) have filed voluntary petitions for reorganisation under chapter 11 of the U.S. Bankruptcy Code to facilitate the Company’s financial and operational restructuring. The petitions were filed in the Southern District of Texas Bankruptcy Court (the “Bankruptcy Court”).

In connection with the filing, ECS has received a commitment on an up to US$90 million financing facility from Chiyoda Corporation and Subsea 7. Subject to bankruptcy court approval, the financing will be made available to support the Company’s continuing business operations, minimise disruption to its worldwide projects and make necessary operational changes.

The restructuring will provide ECS with an opportunity to focus on strengthening its financial and operational systems, enhancing the Company’s efforts to weather the current challenges. As a major player in the subsea sector, ECS’ operational and financial performance is dependent on the macro outlook and expansion plans of oil majors. Whilst ECS has an order book of over US$1 billion, the commencement dates of many of these projects remain in flux, affecting utilisation levels and negatively impacting financial performance. To address these challenges, ECS has commenced a process to restructure its balance sheet and position the Company for the future.

The Company believes that this court process is in the best interest of all of its stakeholders, resulting in value creation and a sustainable capital structure. This difficult but important step will provide for a transparent restructuring of the Company under the supervision of the Bankruptcy Court.

The Company has filed certain customary “first day motions” with the Bankruptcy Court to ensure a smooth transition into chapter 11.

The Company will continue to engage and work closely with all creditors to achieve the best possible consensual restructuring outcome for all interested parties. Guided by its values of safety, customer focus, people, excellence and integrity, the Company intends to establish a foundation for long-term stability and success for the future.

Additional information, including court filings and other documents, regarding the restructuring, can be found by visiting http://dm.epiq11.com/ECS.

 

Chiyoda Corporation (TSE: ISIN: JP3528600004) is a world-leading engineering company, providing a wide-range of services in the fields of energy, chemicals, petrochemicals, industrial facilities and various other areas.

Subsea 7 S.A. (Oslo Børs: SUBC, ADR: SUBCY) is a leading global contractor in seabed-to-surface engineering, construction and services to the offshore energy industry.

 

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