Expro, known as Umbrellastream, files pre-packaged bankruptcy

By Caroline Salls

Pittsburgh, Dec. 20 – Expro Holdings US Inc., which does business as Umbrellastream US Inc., made a pre-packaged Chapter 11 bankruptcy filing on Monday in the U.S. Bankruptcy Court for the Southern District of Texas.

The company said it reached an agreement with its key lenders and shareholders to eliminate its entire $1.4 billion of funded debt and $80 million in annual interest payments through an equity conversion, which will fully deleverage its balance sheet.

Expro said this will provide a stronger and more sustainable capital structure to grow the business and will be supported by an additional $200 million equity commitment from its new shareholders, which will be completed via a rights offering.

Pre-bankruptcy mezzanine lenders and existing holders of preference shares will be eligible to participate in the company’s long-term recovery through the issuance of warrants if their classes vote in favor of the plan.

General unsecured creditors and all other creditors who are unimpaired will recover 100% under the plan.

Holders of Expro ordinary interests will receive no distribution.

The restructuring process is expected to be completed within 60 days.

Expro said the Chapter 11 process will not impact its operations or relationships with employees, customers, business partners or suppliers.

“We are thrilled to have received overwhelming support from our lenders and shareholders as we work to achieve our end goal: creating a stronger financial foundation for the future,” chief executive officer Mike Jardon said in a news release.

“This process will allow the company to deliver on its growth strategy, which includes our continued investment in customer-focused technology solutions that support the next generation of exploration, production and development projects.”

Financing commitment

Under the plan of reorganization, Expro said it will be provided with access of up to $155 million in debtor-in-possession financing, including bonding lines, which will provide working capital to ensure normal business operations continue during the financial restructuring process.

Specifically, the financing is comprised of a $125 million delayed-draw term loan facility and a $30 million letter-of-credit bonding facility.

The lenders include funds and/or accounts managed, advised or controlled by Oak Hill Advisors, LP, Angelo, Gordon & Co., LP and HPS Investment Partners, LLC.

Interest will accrue at a rate of Libor plus 800 basis points.

The DIP facility will mature on the earliest of emergence from the Chapter 11 cases, six months after the bankruptcy filing date, the closing of a sale of all or substantially all of the assets of the company, Jan. 29 if a final order has not been entered by then and the acceleration of the loans and termination of the commitments.

A total of $95 million of the DIP financing will be available to the company on an interim basis.

Expro said it is also seeking court approval to enter into a commitment for a $30 million letter-of-credit exit facility from JPMorgan Chase Bank, NA.

Debt details

According to court documents, Expro has $500 million to $1 billion in assets and $1 billion to $10 billion in debt.

No list of unsecured creditors was filed with the bankruptcy petition.

The company’s legal advisers are Paul, Weiss, Rifkind, Wharton & Garrison LLP and Freshfields LLP. The financial adviser is Lazard, and Expro’s restructuring adviser is Alvarez & Marsal.

Expro provides specialized well flow management products and services to the oil and gas industry. The Chapter 11 case number is 17-60179.

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