Prosafe gains support for restructuring plan in Norway

Offshore accommodation rig provider Prosafe has achieved what it says is an important milestone in its financial restructuring following the approval of its plan in Norway.

Prosafe’s financial restructuring process is on track with formal support from all lenders already received. The extraordinary general meeting approved the solution on 27 September 2021, the Singapore scheme was sanctioned on 18 October 2021, and the Norwegian restructuring proceedings were initiated on 1 September 2021.

In an update on Tuesday, Prosafe said that the restructuring plan proposed in the Norwegian restructuring proceedings has now been approved by the requisite majority in number representing 100 per cent in value of the creditors casting their votes through proxy and voting forms completed and submitted by creditors on 8 November 2021.

The company emphasised that this is an important milestone which will provide further certainty in the overall restructuring process.

Prosafe previously said it expected that the overall process would be completed before or around year-end 2021. Upon completion, this transaction will result in a significant de-leveraging of the balance sheet with approximately 75 per cent of debt reduction, debt service based on cash sweep and a more robust financial situation.

Post-implementation, existing banks/creditors will own 99 per cent of the equity and current shareholders will own 1 per cent of the equity.

Last week, Prosafe reported on its quarterly financial performance, posting the highest quarterly fleet utilisation rate since 2019, nearly quadrupling its revenues and shrinking net loss when compared to the third quarter last year.

In the short term, Prosafe believes the increased capital investment will focus on existing fields. However, the energy transition may take a longer time and be more complicated than most observers believe. Investments in new oil and gas fields will likely see a comeback from 2022/2023, leading to a further increase in the activity for the oil service industry from the middle of this decade.