New Chapter 15 Filing - Boart Longyear Ltd.

Boart Longyear Ltd.

  • 4/27/17 Recap: The company, a provider of (i) drilling services, drilling equipment and performance tooling for mining and mineral drilling companies and (ii) products and services for non-mining drilling customers (i.e., water drilling and non-conventional energy), filed a Chapter 15 petition in the US in support of a larger restructuring filed a few days ago in Australia. The Australian proceeding had been agreed upon by Centerbridge Partners LP, Ares Management LLC and Ascribe II Investments LLC who, collectively, own the majority of the company's secured and unsecured funded debt and common and preferred equity. Notably, however, First Pacific Advisors LLC is NOT on board with the proposed restructuring is already showing signs of litigating (initially by way of seeking a TRO). Generally, this, like many other cases in the recent past, is a macroeconomic story relating to the decline in exploration and production and corresponding decline in drill rig utilization rates and pricing leverage. It is also, however, a story - as we often see - of too much debt. The company attempted a previous recapitalization and debt reduction in 2014; it also implemented a number of operational initiatives. Clearly, these efforts didn't do the trick. And because "[n]o immediate [macro] relief appears to be on the horizon," the company seeks to delever and survive for the next commodities supercycle. 
  • Jurisdiction: S.D. of New York
  • Capital Structure: $205mm 10% secured notes (US Bank NA), $116mm TL-A & $140mm TL-B (Wilmington Trust), $8mm ABL (PNC Bank), $15mm Second Out Facility (Wilmington Trust), $20mm Delayed Draw TL (Wilmington Trust), $295mm 7% unsecured notes (US Bank NA). Publicly-traded under "BLY" on the Australian Securities Exchange.    
  • Company Professionals:
    • Legal: Milbank Tweed Hadley & McCloy LLP (Dennis Dunne, Evan Fleck, Dennis O'Donnell) & Ashurst (James Marshall)
    • Financial Advisor: FTI Consulting Inc. (Paul Hansen)
    • Claims Agent: Prime Clerk LLC (*click on company name above for free docket access)
  • Other Parties in Interest:
    • Supporting Noteholder Committee: Ares Management LLC, Ascribe II Investments LLC
      • Legal: Sullivan & Cromwell LLP (Michael Torkin, David Zylberberg)
    • Centerbridge Partners LP
      • Legal: Kirkland & Ellis LLP (Anup Sathy, Gregory Pesce, John Luze)
    • First Pacific Advisors LLC
      • Legal: Paul Weiss Rifkind Wharton & Garrison LLP (Andrew Rosenberg, Alice Belisle Eaton, Alexander Woolverton, Daniel Youngblut) & (Australia) Gilbert+Tobin (Dominic Emmett, David Clee)
    • PNC Bank NA
      • Legal: Holland & Knight LLP (Michelle Suarez, Arthur Rosenberg, Robert Jones, Brian Smith)

Updated 5/31/17