Trico Supply, Trico Shipping to complete out-of-court restructuring

By Caroline Salls

Pittsburgh, April 21 - Trico Marine Services, Inc. subsidiaries Trico Supply AS and Trico Shipping AS have reached an agreement in principle with their working capital facility lenders and accepted for exchange $396.45 million of 11 7/8% senior secured notes due 2014 tendered in their exchange offer, according to a company news release.

The tendered notes represent more than 99.1% of the 11 7/8% notes.

In the subsidiaries' out-of-court restructuring, the noteholders, Trico Supply and Trico Shipping's lenders and Trico Marine entities holding intercompany claims and interests, will be equitized and proportionately share all the common stock of DeepOcean Group Holding AS, a new Norwegian private limited company.

Trico Supply and Trico Shipping and their subsidiaries will no longer be subsidiaries of Trico Marine but of DeepOcean Group Holding, which will be based in Europe, the release said. Operations will continue as normal.

The exchange offer is expected to conclude on April 28.

As Trico Supply and Trico Shipping expect to finalize the out-of-court restructuring, the companies said they have set aside their efforts to seek further support of a pre-packaged plan of reorganization.

"Today's announcement represents a major accomplishment in the Trico Supply Group's financial restructuring efforts, and we are very pleased to have received the approval from its noteholders and other creditors," Trico Marine chairman of the board, president and chief executive officer Richard A. Bachmann said in the release.

"The debt-to-equity swap will enable the Trico Supply Group to reduce total debt to approximately $75 million and provides the company with increased operating flexibility and a more appropriate capital structure for a company its size.

"Once the restructuring is complete, we believe that the company, including its primary business units of DeepOcean and CTC Marine, will be in an excellent position to take advantage of improving market conditions and global growth opportunities.

"The Trico Supply Group looks forward to an improved liquidity position from which it will be able to better serve its customers."

According to the release, the restructuring will reduce the subsidiaries' total debt outstanding to roughly $75 million from $468 million. As part of the restructuring, Trico Supply and Trico Shipping will also receive a new $100 million first-priority senior secured credit facility that would be used to refinance some existing debt and fund working capital borrowings.

Trico Marine and some of its subsidiaries will receive shares of common stock of DeepOcean Group Holding, the release said. However, the out-of-court financial restructuring of the Trico Supply Group does not otherwise alter Trico Marine's pending bankruptcy proceeding.

Trico, a marine services company based in the Woodlands, Texas, filed for bankruptcy on Aug. 25, 2010 in the U.S. Bankruptcy Court for the District of Delaware. The Chapter 11 case number is 10-12653.

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