Mattos Filho assists Valaris on restructuring

Mattos Filho has advised all contractual, restructuring and financial issues in connection with Valaris operations in Brazil

Valaris is the largest offshore drilling service provider and operates one of the most significant global fleets in the sector. In 2019, the company’s revenues were approximately 2.053 billion, being primarily from Total S.A., B.P., Saudi Aramco, and Petrobras.

Valaris was the third offshore drilling contractor to file for bankruptcy this year. First, the company entered into a restructuring support agreement and backstop commitment agreement with around 50% of its unsecured noteholders to implement a comprehensive financial restructuring and substantially reduce its debt profile. On September 15, Valaris announced that the number of noteholders supporting the recovery has increased from 50% to 72% in aggregate principal amount of its senior notes (the “Consenting Noteholders”) that executed the Restructuring Support Agreement and Backstop Commitment Agreement.

The RSA and BCA contemplate, among other things, the full equitisation of over $ 6.5 billion of debt under Valaris’ unsecured revolving credit facility and unsecured notes, a fully backstopped rights offering to unsecured noteholders for $ 500 million of new secured notes and the effective cancellation of existing equity interests in Valaris in exchange for warrants for post-emergence equity in certain circumstances.

To implement the RSA, on August 19 2020, Valaris filed prearranged chapter 11 cases in the Southern District of Texas together with the agreed restructuring plan.

Mattos Filho team was led by partners Frederico Kerr Bullamah (pictured upper left), Marcelo G. Ricupero (pictured upper right), Nilton Gomes de Mattos Neto (pictured bottom left), and Giovani Loss (pictured bottom right).