Seadrill and North Atlantic Drilling Try to Stay Afloat as Debt Restructuring Becomes Key

NEW YORK, NY / ACCESSWIRE / April 5, 2017 / Seadrill and its majority owned subsidiary, North Atlantic Drilling, both saw their stock prices cut in half as investors digested the news from Bermuda. The combination of reduced oil demand and lower oil prices combined to deliver a serious blow to investor’s hopes.

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Seadrill Ltd. https://ub.rdinvesting.com/news/?ticker=SDRL

North Atlantic
Drilling Ltd. https://ub.rdinvesting.com/news/?ticker=NADL

Seadrill plummeted 55.69% to close at $0.74 a share on Tuesday. The stock traded between $0.65 and $1.10 on a large volume spike of 75.5 million shares traded. The company announced that investors can expect steep losses as a result of its current debt restructuring and that stockholders and bond investors need a significant reversal of fortune if the company is to avoid bankruptcy.

The new debt restructuring plan extends some debt from April 30th to July 31st of this year, and extends the related covenant amendments and waivers expiring June 30th of this year to September 30, 2017.

“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 said in a statement. “The company currently expects that shareholders are likely to receive minimal recovery for their existing shares.”

Access RDI’s Seadrill Research Report at:
https://ub.rdinvesting.com/news/?ticker=SDRL

North Atlantic Drilling gravitated downward 55.45% to close at $0.75 a share on Tuesday. The stock traded between $0.72 and $1.34 on volume of 1.36 million shares traded. The company announced that Seadrill Limited, on behalf of NADL, will extend the due dates on its debt to coincide with Seadrill’s current financial crisis.

In an agreement made by Seadrill’s debtors, North Atlantic Drilling debt will be extended on the NADL credit facility maturing on June 30, 2017 to September 14, 2017. Total debt for this note is $2.0 billion. In addition, the company has $413 million in bonds that are neither owned nor guaranteed by Seadrill.

Access RDI’s North Atlantic Drilling Research Report at: https://ub.rdinvesting.com/news/?ticker=NADL

Our Actionable Research on Seadrill Ltd. (NYSE: SDRL) and North Atlantic Drilling Ltd. (NYSE: NADL) can be downloaded free of charge at Research Driven Investing.

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Disclaimer: This article is written by an independent contributor of RDInvesting.com and reviewed by Nadia Noorani, CFA® charter holder. RDInvesting.com is neither a registered broker dealer nor a registered investment advisor. For more information please read our full disclaimer at www.rdinvesting.com/disclaimer.

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