Trico subsidiaries pursue out-of-court restructuring, eye pre-packaged plan as alternative

By Angela McDaniels

Tacoma, Wash., March 1 - Trico Marine Services, Inc. subsidiaries Trico Supply AS and Trico Shipping AS are pursuing a financial restructuring plan that includes an exchange offer for Trico Shipping's outstanding 11 7/8% senior secured notes due 2014 and a new $100 million first-priority senior secured credit facility.

The proceeds of the new facility would be used to refinance some existing debt and fund working capital borrowings.

If the plan is unsuccessful, the companies plan to file for Chapter 11 bankruptcy.

The plan has the support of the holders of about 83% of Trico Shipping's outstanding 11 7/8% notes.

Under a restructuring support agreement reached with the noteholder group, Trico Shipping has launched an out-of-court exchange offer for the notes.

The noteholders are being offered a pro rata share, together with the lenders under Trico Shipping's working capital facility, of 95% of the common stock of DeepOcean Group Holding AS, a to-be-formed Norwegian company that would be the holding company of the Trico Supply Group.

The company is also soliciting consents to amend the indenture to eliminate or modify some restrictive covenants and other provisions.

The exchange offer is subject to the receipt of tenders for at least 99% of the outstanding notes and the receipt of consent from Trico Shipping's secured working capital credit facility lenders.

In connection with the restructuring, the U.S. Bankruptcy Court with jurisdiction over the Trico Marine bankruptcy cases has approved a settlement that compromises the intercompany claims and equity interests held by Trico Marine and some subsidiaries in exchange for 5% of the new common stock and warrants to acquire an additional 10% of the new common stock, which the company expects would ultimately be distributed to certain creditors of Trico Marine.

The company said the exchange offer and related transactions would reduce its estimated total debt outstanding to about $75 million.

Pre-packaged plan

As an alternative to the exchange offer, the company is soliciting acceptances from its noteholders of a pre-packaged plan of reorganization that it will pursue if the exchange offer is not successful and if a sufficient number of holders and amount of notes vote to accept it.

If the company files a pre-packaged plan, it expects to fund its working capital requirements with a debtor-in-possession financing facility provided by the noteholder group.

If confirmed, the pre-packaged plan would have principally the same effect as the exchange offer, according to the news release.

Additional information about the exchange offer is available to noteholders by contacting Epiq Systems Inc. (646 2822400).

Trico Marine Services is a marine services company based in the Woodlands, Texas. It filed for bankruptcy on Aug. 25, 2010 in the U.S. Bankruptcy Court for the District of Delaware. The Chapter 11 case number is 10-12653. Trico Shipping is not a debtor in Trico Marine's bankruptcy case.

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