Seadrill Partners files Chapter 11 plan; statement hearing March 1

By Sarah Lizee

Olympia, Wash., Feb. 16 – Seadrill Partners LLC filed a Chapter 11 plan of reorganization and related disclosure statement Saturday in the U.S. Bankruptcy Court for the Southern District of Texas.

The plan contemplates restructuring transactions under a plan support agreement entered into with consenting term loan B lenders that will equitize about $2.7 billion in secured term loan debt. The plan will also put in place go-forward operators for the debtors’ assets.

Under the plan, holders of other secured claims will receive payment in full in cash, the collateral securing their claims, or reinstatement of their claims.

Holders of other priority claims will receive payment in full in cash.

Holders of super senior term loan claims will receive their pro rata share of new common stock, subject to dilution by any new common stock that may be issued under the employee incentive plan, if any.

Holders of term loan B secured claims will receive their pro rata share of new common stock, subject to dilution, unless holders elect to receive the cash out amount per $1,000 of claims in cash, subject to a cap, which will be determined. If the total elections would result in distributions of cash to holders in excess of the cash cap, then each holder will receive their pro rata share of the cap in cash and new common stock equal to the balance the recovery holders would have received in the absence of the cash cap.

Holders of general unsecured claims will receive treatment to be determined consistent with the plan support agreement.

Intercompany claims will be reinstated, converted into equity, or canceled.

Intercompany interests will be reinstated, or merged, contributed, addressed or canceled and released.

Interests and section 510(b) claims will be canceled.

A hearing on approval of the disclosure statement is scheduled for March 1.

London-based Seadrill Partners owns, operates and acquires offshore drilling rigs and filed Chapter 11 bankruptcy on Dec. 1 under case number 20-35740.

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