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Rig firm SeaDrill shares sink as it warns of potential bankruptcy again
Offshore rig firm Seadrill Ltd (NYSE: SDRL) laid bare the problems besetting the global oil industry as it saw shares plummet today as it warned again of potential bankruptcy.
Shares in New York sank over 40% to stand at $1 a pop.
The stock has already sunk 95% in the last three years as lower crude prices mean oil firms are simply cutting expenditures and therefore drilling.
In February this year it warned of potential Chapter 11 bankruptcy.
Today’ sell off comes as the firm announced a $14 billion debt restructuring deal, which it said will likely result in shareholders receiving a “minimal recovery for their existing shares”.
“We currently believe that a comprehensive restructuring plan will require a substantial impairment or conversion of our bonds, as well as impairment, losses or substantial dilution for other stakeholders,” Seadrill told a statement.
The firm said its banks and lenders had agreed to extend restructuring talks by three months to July 31.
Seadrill is negotiating with more than 40 banks, including Norway’s DNB, Sweden’s Nordea and Denmark’s Danske Bank, as well as bondholders and rig-building yards.
Story by ProactiveInvestors
Source: http://www.proactiveinvestors.com/companies/news/175951/rig-firm-seadrill-shares-sink-as-it-warns-of-potential-bankruptcy-again-175951.html
