Weatherford International plc today announced that it has refinanced its senior secured asset-based lending agreement (the "ABL Credit Agreement") through the issuance of $500 million of senior secured first lien notes (the "Senior Secured Notes"). The Company also amended and increased the size of its senior secured letter of credit agreement (the "LC Credit Agreement") to $215 million.
The proceeds from the issuance of the Senior Secured Notes will be used to enhance the Company's liquidity and support the issuance of letters of credit. These actions will provide the Company with additional liquidity and flexibility to manage through the current operating environment, with the Company having over $1.2 billion of cash on hand at closing, including the net proceeds from the transactions, over $50 million of capacity under its upsized LC facility and no debt maturities prior to the second quarter of 2024.
Charles M. Sledge, Chairman of the Board of Directors, commented, "We have strengthened the Company's capital structure enabling Weatherford to continue to deliver against our strategic objectives during this challenging environment. These transactions successfully conclude the review of alternatives announced in May. We appreciate the continued support provided by the Company's stakeholders and the confidence they have placed in our long-term success."
Key Details of the Transactions:
- Issued $500 million of 8.75% senior secured first lien notes maturing on September 1, 2024
- Terminated the ABL Credit Agreement by repaying all borrowings and cash collateralizing or moving letters of credit under the LC Credit Facility
- Amended the LC Credit Agreement to, among other things, increase the aggregate commitments under the facility to $215 million and reduce the minimum liquidity covenant
Lazard served as the Company's financial advisor on the transactions and Paul, Weiss, Rifkind, Wharton & Garrison, and Latham & Watkins served as the Company's legal counsel.
The Senior Secured Notes will not be registered under the Securities Act of 1933, as amended (the "Securities Act"), and may not be offered, sold or otherwise transferred except under an exception from, or in a transaction not subject to, the registration requirements of the Securities Act or any other applicable securities laws.
Source: Weatherford
