Seadrill warns debt talks could leave shareholders with nothing

OSLO, Aug 25 (Reuters) - Offshore drilling rig contractor Seadrill's SDRL.OL ongoing attempt to restructure its massive debt could leave current shareholders with minimal or no ownership at all, the Oslo-listed company warned on Tuesday.

Demand for exploration and drilling has fallen further during the COVID-19 pandemic as oil firms seek to preserve cash, idling more rigs and leading to further overcapacity in the industry.

Seadrill, controlled by Norwegian-born tycoon John Fredriksen, said it has failed to convince its 43 lenders to adjust the terms of its $5.7 billion bank debt.

"As a consequence, we did not proceed with the bank consent and have retained financial and legal advisors to prepare for a comprehensive restructuring of our balance sheet, such a restructuring may involve the use of a court-supervised process," it added.

Seadrill, which emerged from Chapter 11 bankruptcy court proceedings in 2018, has seen its shares drop more than 98% in the last two years.

The company had total debt and liabilities of $7.3 billion at the end of the second quarter.

(Reporting by Nerijus Adomaitis, editing by Terje Solsvik)

((; +47 9027 6699))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


More Related Articles

Info icon

This data feed is not available at this time.

Sign up for Smart Investing to get the latest news, strategies and tips to help you invest smarter.