Seadrill 2021 Limited announced on February 23, that it has emerged from Chapter 11 after successfully completing its reorganization pursuant to its Chapter 11 plan of reorganization (the “Plan”). The Plan was confirmed by the U.S. Bankruptcy Court for the Southern District of Texas on October 26, 2021.

The restructuring significantly delevered the Company’s balance sheet by equitizing approximately $4.9 billion of secured bank debt previously held across twelve silos, resulting in a streamlined capital structure with a single collateral silo. The Company also raised $350 million in new financing pursuant to the Plan. Holders of existing shares (the “Existing Shares”) in the Company’s predecessor, Seadrill Limited, were reduced to 0.25% of their existing holdings, while the Company’s employee, customer, and ordinary trade claims were unaffected by the restructuring. The Company’s streamlined capital structure and the substantial liquidity raised pursuant to the Plan provide the Company with secure footing to pursue opportunities in the offshore drilling industry and grow value for its stakeholders.  

Stuart Jackson, CEO of Seadrill, commented: “Our emergence from Chapter 11 concludes the realignment of our balance sheet. I am grateful to all our employees, customers, partners, suppliers, creditors and shareholders for their support through this long process. 

“Our restructured balance sheet provides us greater liquidity and lower debt leverage. With this firm financial footing established and market recovery well underway, Seadrill will focus on disciplined capital investment, cost containment, and contract risk management to maintain its position as a leader in the reshaping of the industry.”  

The figures presented below highlight key financial metrics as of the Effective Date:

• Total cash of 486m, inclusive of $151m of restricted cash
• $300 million of first-lien new-money debt, comprised of a $175 million term loan facility and an undrawn $125 million revolving credit facility
• $683 million of second-lien takeback debt
• $50 million of unsecured convertible bonds
• Common shares issued of approximately 50 million as described further below.

Issuance, Listing and Trading of New Common Stock

Subject to certain approvals, the Company intends to have the New Common Shares listed on the Euronext Expand market in Oslo (“Euronext Expand”) with a subsequent uplisting to the main market of the Oslo Stock Exchange (the “OSE”) and the New York Stock Exchange (the “NYSE”). 

Approximately 50 million New Common Shares were issued as of the Effective Date and remain outstanding.  The New Common Shares are allocated as set forth below, in accordance with provisions of the Plan: 

• 83.00% of the New Common Shares issued to holders of credit agreement claims against the Company and certain of its Chapter 11 debtor affiliates;
• 16.75% of the New Common Shares issued to rights offering participants and backstop parties under the Plan; and
• 0.25% of the New Common Shares issued to holders of Existing Shares in the Company’s predecessor.

Subject to certain approvals, we expect that trading in the New Common Shares on Euronext Expand will commence in the second quarter of 2022. Further details in respect of the New Common Shares will be set out in a listing prospectus which will be approved by the Norwegian Financial Supervisory Authority and published prior to listing at Euronext Expand.

The New Common Shares will be issued under CUSIP G7997W102 / ISIN BMG7997W1029, provided that a portion of the New Common Shares will be issued under Regulation S of the U.S. Securities Act of 1933 with CUSIP G7997W110 / ISIN BMG7997W1102. The New Common Shares issued under Regulation S will be subject to certain restrictions on resale into the United States, during a distribution compliance period as set forth in Regulation S. Because the Company will continue to use the ticker symbol “SDRL” for trading Existing Shares, brokers, dealers and agents effecting trades in the Existing Shares on the OSE or OTC Pink markets, and persons who expect to receive New Common Shares or effect trades in New Common Shares, should take note of the anticipated cancellation of the Existing Shares and issuance of New Common Shares, and the different CUSIP numbers and ISINs signifying the Existing Shares and the New Common Shares, in trading or taking any other actions in respect of shares of the Company that trade under the ticker symbol “SDRL”.

Any questions regarding these distributions should be directed to the Company’s claims and noticing agent, Prime Clerk, on the numbers provided below. 

Fresh Start Reporting and Accounting Policies

On the Effective Date, the Company adopted fresh-start reporting. Under fresh-start reporting, the Company’s assets and liabilities are re-measured using fair value accounting principles. Estimates of fair value adopted under fresh-start reporting represent the Company’s best current estimates based upon appraisals and valuations. These accounting changes will be reported in the Company’s earnings report for the quarter ended March 31, 2022. The Company’s earnings report for the period to December 31, 2021, which has been published concurrently with this release, covers a period prior to the Company’s emergence from bankruptcy and therefore does not reflect fresh-start reporting.

New Board of Directors

In accordance with the Plan, a newly constituted Board of Directors of the Company has been appointed, consisting of Julie Johnson Robertson (Chair of the Board), Mark McCollum (Chair of Audit Committee), Karen Dyrskjot Boesen, Jean Cahuzac, Jan B Kjærvik, Andrew Schultz, and Paul Smith.

Julie Robertson, Chair of the Board, commented: “I am pleased to have been selected to chair the new Board of Directors who collectively bring commercial, operational and financial expertise to guide Seadrill as it takes its place in reshaping the offshore drilling sector.  The road to emergence from Chapter 11 has been a long one and I would like to take this opportunity to thank the outgoing board members for their diligent guidance through this process and to thank the management team and the employees for maintaining safety leadership and operational excellence through challenging times.” 

The Company was principally advised by Kirkland & Ellis LLP, Slaughter and May, Advokatfirmaet Thommessen AS, Jackson Walker LLP, Conyers Dill & Pearman Pte Ltd, Houlihan Lokey Capital, Inc., and Alvarez & Marsal North America, LLP.

Prime Clerk 
US Toll Free: 844-858-8891 
International Toll Free: 312-667-1347 
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