Weatherford: No maturities until 2024 after notes sale, debt paydown

By Devika Patel

Knoxville, Tenn., Nov. 4 – Weatherford International plc extended its runway, with no debt maturities until 2024, through several financing activities, including selling $500 million of notes and paying off its asset-based credit facility, last quarter.

“In late August, the company completed a related set of transactions, which included issuing $500 million of senior secured first lien notes, terminating our senior secured asset-based lending agreement and amending and increasing the size of our senior secured letter of credit agreement to $215 million,” executive vice president and chief financial officer H. Keith Jennings said on the company’s third quarter ended Sept. 30 earnings conference call on Wednesday.

“The transactions meaningfully enhanced our liquidity with the company closing the quarter with approximately $1.3 billion of total cash on hand at the end of September.

“Further, by terminating the ABL, we eliminated the risk of a potential breach of the associated financial covenants.

“With increased liquidity and no maturities until 2024, we have extended our runway, enabling our continued focus on supporting our customers and delivering on our priorities,” he said.

Adjusted EBITDA was $104 million for the quarter.

The company's liquidity position was enhanced during the quarter, with total cash increasing by $537 million sequentially to approximately $1.3 billion as of Sept. 30.

On Aug. 28, Weatherford International Ltd. reported that Weatherford Bermuda issued $500 million of new 8¾% senior secured first-lien notes due Sept. 1, 2024 to some holders of its 11% senior notes due 2024 and repaid its asset-based credit facility.

Proceeds will be used to enhance the company’s liquidity and support the issuance of letters of credit.

The company repaid and terminated its asset-based credit facility and increased its letter-of-credit agreement by $50 million to $215 million.

The new notes are guaranteed by Weatherford International plc as well as some subsidiaries.

Weatherford is an oilfield services company based in Baar, Switzerland. The company filed bankruptcy on July 1 under Chapter 11 case number 19-33694.

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