Forbes Energy confirms prepackaged oilfield services restructuring
The court approved Forbes Energy Services Ltd.'s disclosure statement and confirmed its prepackaged Chapter 11 plan on March 29, roughly nine weeks after the Alice, Texas-based oilfield services company and four affiliates filed on January 22 in the Southern District of Texas source filing. The parent petition listed $332.6 million of assets and $337.0 million of debts, while the first-day declaration tied the filing to the post-2014 oil-and-gas downturn, a revenue collapse from $202.7 million to $88.2 million for the nine months ended September 30, 2016, and a balance sheet anchored by about $24.0 million under a senior secured facility and $280.0 million of senior unsecured notes source filing source filing.
The business entered Chapter 11 with about 835 employees and two operating segments: well servicing, which generated 60.4% of 2016 year-to-date revenue, and fluid logistics, which generated 39.6% source filing. The plan was built around a debt-for-equity exchange for the senior unsecured notes and a $50 million exit facility backed by Ascribe Capital, Courage Capital, PIMCO, Phoenix Investment Adviser and Solace Capital; holders of 87.14% of the voting senior note principal supported the restructuring before the petition date source filing. Confirmation leaves the reorganized debtors positioned to emerge with new common stock, a new board and a management incentive plan, while existing parent equity was deemed to reject the plan source filing.
