Vantage Drilling Files Chapter 11 Bankruptcy
Posted on Thursday, December 10th, 2015 at 2:53 pm
Another drilling company has filed for bankruptcy protection due to the current state of the oil industry. Vantage Drilling Co., an offshore oil rig operator, filed for Chapter 11 bankruptcy on December 2 after being linked to a corruption scandal in the Brazilian state-run oil firm. The company reached a deal with lenders and bondholders that forgave $1.15 billion in debt for control over Vantage Drilling Co. The company filed for bankruptcy in U.S. Bankruptcy Court in Wilmington, Delaware. The debt-for-equity deal could leave Vantage’s Offshore Group Investment Ltd. subsidiary in place.
Other oil and gas companies have been suffering through low oil prices as well. U.S. crude oil prices have dropped from $100 a barrel to $40 a barrel. Other rig operators such as Hercules Offshore Inc. and Cal Dive International Inc. also filed for bankruptcy this year. While low oil prices are a leading factor for these bankruptcies, there has also been an oversupply of drilling rigs since 2013.
Vantage listed $3.5 billion in assets and $3 billion in debt. The initial deal with lenders and bondholders eliminates $152 million in annual interest expenses and will allow the company $242 million in cash. The 190 person company intends to stay open through bankruptcy.
Oftentimes it is a poor market that causes businesses to seek bankruptcy protection. If your business is in debt and you are considering filing for bankruptcy, contact the attorneys at the Bradford Law Offices, PLLC. Our experienced and dedicated Raleigh lawyers want to walk you through the bankruptcy process so you are left with the best outcome. Please call (919) 758-8879 today for more information.