Prospect News reports six new defaults for Oct. 13-Oct. 19; S&P three

By Caroline Salls

Pittsburgh, Oct. 21 – Prospect News reported six new defaults for the period of Oct. 13 through Oct. 19.

Specifically, Prospect News reported a Chapter 15 bankruptcy filing made by Platinum Partners Value Arbitrage Fund (International) Ltd., a Chapter 7 bankruptcy filing made by PetroHunter Energy Corp., a missed interest payment on Nuverra Environmental Solutions, Inc.’s 9 7/8% senior notes due 2018, EnQuest plc’s 7% senior notes due April 15, 2022 and Swissco Holdings Ltd.’s 5.7% notes due April 16, 2018 and a missed principal payment on Broad Greenstate International Co. Ltd.’s notes due Oct. 15, 2017.

In addition, Prospect News reported a missed interest payment on Basic Energy Services, Inc.’s 7¾% senior notes due 2022, Bonanza Creek Energy Inc.’s 6¾% senior notes due 2021 and Swiber Holdings Ltd.’s 7 1/8% series 014 notes due 2017, as well as Gulf Keystone Petroleum Ltd.’s recapitalization. However, those four companies had previously defaulted.

So far this year, Prospect News has reported 193 defaults, including 87 Chapter 11 bankruptcy filings, 45 missed interest payments, 11 missed principal and interest payments, nine each of missed principal payments and Chapter 15 bankruptcy filings, five each of Companies’ Creditors Arrangement Act filings and Chapter 7 bankruptcy filings, three each of missed interest payments paid within the grace period and restructurings, two each of insolvencies, administrations and recapitalizations and one each of CBCA filings, judicial management requests, schemes of arrangement, plans of arrangement, debt arrangements, missed interest payments paid late, liquidations, mandataire ad hoc appointments, suspensions of payments and homologaciones.

Meanwhile, Standard & Poor’s reported three new defaults for the week, raising its year-to-date total to 136 issuers.

S&P said this default count has already surpassed the total number of defaults recorded in full-year 2015 and is 53% higher than the count at this time in 2015. The last time the global tally was higher at this point in the year was in 2009, when it reached 236 during the financial crisis.

S&P lowered its long-term corporate credit rating on Seven Energy International Ltd. to D from CCC- after the issuer missed the interest payment on its $300 million and $100 million senior notes bond and lowered the corporate credit rating on Bonanza Creek Energy to D from CC following the issuer’s missed interest payment. If Bonanza Creek does not make the payment within the 30-day grace period, S&P said it intends to withdraw its rating. However, if the payment is made, S&P said it will likely raise the rating.

The ratings agency also lowered its long-term rating on EnQuest to SD from B- after the issuer failed to make its interest payment due Oct. 17 on its $650 million notes.

Of the 136 defaulters so far in 2016, S&P said 51 issuers defaulted because of missed principal and/or interest payments, 36 because of distressed exchanges, 16 upon bankruptcy filings, 13 were confidential, seven because of debt exchange, six upon de facto restructuring, two because of deferred interest payments, and one each defaulted because of debt acceleration, distressed restructuring, judicial reorganization, regulatory intervention and a debt moratorium.

S&P said the United States leads with 89, or 65%, of global defaults so far in 2016, followed by 25 from emerging markets and 11 each from Europe and the other developed nations, which includes Australia, Canada, Japan and New Zealand.

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