Superior Offshore creditors seek case conversion, cite no chance for rehabilitation

By Caroline Salls

Pittsburgh, Dec. 23 - Superior Offshore International Inc. creditors and equity holders Louis E. Schaefer Jr. and Schaefer Holdings, LP asked the U.S. Bankruptcy Court for the Southern District of Texas to convert the company's bankruptcy case to Chapter 7, according to a Tuesday court filing.

According to the motion, Superior Offshore has no likelihood of rehabilitation, and substantially all of the company's tangible assets have already been liquidated.

In addition, the Schaefer entities said there is a continuing loss and diminution of the company's estate because of a substantial amount of professional fees that are unnecessarily being incurred, which could be eliminated in Chapter 7 bankruptcy.

"The creditors' committee, the equity committee and their respective sets of attorneys are unnecessarily draining the estate of its available cash," the Schaefer entities said in the motion.

A hearing is scheduled for Jan. 28.

Superior Offshore, a Houston-based provider of subsea construction and commercial diving services to the crude oil and natural gas exploration and production industries and gathering and transmission industries, filed for bankruptcy on April 24, 2008. Its Chapter 11 case number is 08-32590.

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