Brazil’s Constellation Oil inks amended plan support, backstop deals

By Caroline Salls

Pittsburgh, Feb. 22 – Constellation Oil Services Holding SA has entered into an amended and restated plan support agreement and backstop commitment agreement with 100% of the lenders under its project financings, working capital facility lender Banco Bradesco SA, Grand Cayman Branch, holders of a majority in amount of its 9% cash/0.50% PIK senior secured notes due 2024 and its shareholders, according to a news release.

The company said its restructuring has the support of a majority of its creditors. The noteholders that are party to the amended agreements have committed to backstop a rights offering to raise $27 million of new capital.

“With the support of holders of over 50% of the 2024 notes, who have agreed to inject an additional $27 million of new capital into the company upon closing of our restructuring, we have a majority of all financial creditors supporting the better-capitalized company and look forward to a quicker path through our restructuring,” Constellation chief executive officer Leduvy Gouvea said in the release.

“The company continues to perform well under its existing and new contracts and appreciates the support of our customers, suppliers, employees and other stakeholders as we recapitalize and re-profile our debt obligations.”

Constellation is a market leading provider of offshore and onshore oil and gas contract drilling and FPSO services in Brazil through its Rio de Janeiro-based subsidiary Servicos de Petroleo Constellation SA, which made a Chapter 15 bankruptcy filing on Dec. 6 to gain U.S. court recognition of its Brazilian judicial reorganization proceedings. The Chapter 15 case number is 18-13952.

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