Hornbeck Offshore Emerges from Chapter 11 Bankruptcy
OSV operator Hornbeck Offshore has emerged from a prepackaged Chapter 11 bankruptcy proceeding, shedding or reconfiguring all of its preexisting debt. From the first filing to exit, the process took less than four months.
All of the firm's trade creditors and vendors have been paid in full, Hornbeck said, and all debtor-in-possession financing has been converted into a new senior secured loan. All of the firm's preexisting secured loans and unsecured senior bond notes have been canceled for a combination of new secured debt, new equity and new equity warrants or cash. Hornbeck's preexisting shareholders have lost all equity interest.
In addition, Hornbeck closed on a rights offering that gives it $100 million in new equity capital, with participation led by Ares Management, Whitebox Advisors and Highbridge.
"The quick completion of our reorganization and emergence from Chapter 11 is a significant achievement, particularly given the currently very challenging economic environment," said Todd M. Hornbeck, chairman, president and CEO of Hornbeck Offshore Services. "I want to thank our employees, customers, vendors, lenders and note holders for their steadfast support, which allowed us to maintain normal operations during this process. We will now go forward with a stronger financial foundation and are well positioned for long-term success."
The firm also has a new board. Founder Larry D. Hornbeck has been named chairman emeritus, and Todd Hornbeck has taken the top post as chairman. Other new members include former Louisiana Governor Bobby Jindal, former chief of naval operations Adm. John Richardson (USN, ret'd) and former Tidewater CEO John T. Rynd.
The offshore sector has been deeply affected by a soft, oversupplied market for the past five years. Many of the largest operators have filed for bankruptcy, including Bourbon, Gulfmark, Tidewater, Hermitage, Harvey Gulf and Toisa, shedding debt or preparing for consolidation.