French banks takeover offer for Bourbon ‘would lead to liquidation and total loss for shareholders’

A French court is set to give its ruling in the case of the struggling French offshore vessel owner Bourbon related to a takeover offer for the company on December 23, 2019. If the court were to favor an offer by a group of French banks it would lead to the liquidation of the listed company Bourbon Corporation and a total loss for shareholders and bondholders.

As part of the reorganization proceedings opened since August 7, 2019, by the Marseilles Commercial Court to the benefit of Bourbon Corporation and its affiliate Bourbon Maritime, Court Administrators in October received a takeover offer from a company owned by a group of French banks. The offer concerns the assets and activities of Bourbon Corporation.

In a statement on Tuesday, December 10 Bourbon said that the offer of Société Phocéenne de Participation (SPP), a company owned by a group of French banks representing 75% of the group’s debt, would lead to the conversion into capital of approximately €1.4 billion of debt currently borne by the group and €300 million of debt in the form of repayable bonds.

It also includes €150 million in bank financing, of which €30 million can be released as soon as the transfer of ownership is completed to meet immediate liquidity needs.

Liquidation looms?

According to Bourbon, if this offer were accepted, Bourbon Corporation would be liquidated, leading to a total loss notably for the shareholders and bondholders.

Société Phocéenne de Participation informed the court that if its plan were adopted and it then became the shareholder of 100% of Bourbon Maritime’s capital, a company in reorganization proceedings, holding of all Bourbon’s activities, it would present a continuation plan for Bourbon Maritime for which 75% of the creditors have already given their consent.

In terms of governance, the SPP’s proposition would be to provide the company with a supervisory board composed of 8 to 10 members representing the shareholder and industry experts, as well as a Management Board composed of Gaël Bodénès, Chairman, and Thierry Hochoa.

Bourbon also said that the offer submitted on behalf of JS & Co by Jacques de Chateauvieux, Bourbon Chairman and CEO, could not be examined. The Chinese company ICBC Financial Leasing, supporting the SPP, refused to discuss a possible agreement with JS & Co, an agreement that was a condition precedent to its offer.

The representatives of the other two offers, Peschaud and Tidewater, did not appear at the hearing.

The court is due to rule on December 23, 2019.

Jacques de Chateauvieux, Bourbon Chairman and CEO, said: “The court’s decision, if it were to favor the SPP’s offer, would lead to the liquidation of the listed company Bourbon Corporation and a total loss for shareholders and bondholders.

“It would make Bourbon Maritime’s new shareholders responsible for the recovery of a French company, which is still the world leader in offshore oil and gas marine services, its future development and the preservation of its decision-making centers in France.”

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