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[posting]62482872[/posting]23.1. McDermott International Enters Chapter 11 Bankruptcy https://seekingalpha.com/article/4318778-mcdermott-internati… • The management team at McDermott International, after several months of inaction and poor decision-making, finally took the company into Chapter 11 protection. • This move will wipe shareholders out and leave the most junior holders of debt with very little. • The company that emerges from the process looks to have significant potential, but only time will tell. ... Common shareholders will be essentially wiped out, while holders of the Senior Notes of the firm won’t end up much better off. ... In the first half of 2019, the company saw new bookings worth around $14 billion. In the second half of the year, this figure plummeted to less than $3 billion. ... The firm has also secured a $2.4 billion letter of credit facility, and when all is said and done, it will exit Chapter 11 with around $500 million in funded debt on its books. In all, $4.6 billion in debt will be wiped clean from the company’s books. ... One frustrating thing from the perspective of a watcher of the firm (and likely even more frustrating for shareholders) is that management delayed selling off Lummus Technology for far too long. Had action been taken up a year earlier, it’s very likely McDermott would not be in this tough position today, but only now that they decided to file for bankruptcy did they decide to sell their valuable technology segment off. (FC: an zwei private equity firms: The Chatterjee Group + Rhone Group als Plan) ... Senior Notes holders, for instance, are going to walk away with only 19% of their estimated value of $1.402 billion. This will come in the form of an estimated 6% of the common shares in the new company that will emerge from bankruptcy. They will also receive some additional shares (an unspecified amount, but likely nominal) plus some warrants. Everybody junior to them, like shareholders, will walk away with nothing. ... Last year, it was estimated that free cash flow for the business was -$1.191 billion. If bankruptcy only takes a short part of the 2020 fiscal year, the company believes it will see net outflows this year of an additional $550 million. Next year, though, it should see net inflows of $56 million, and for the full period of 2020 through 2024, it expects net inflows of $1.808 billion. If this does come to pass, the company should go on to be worth far more than the $2.25 billion mid-point a third-party firm evaluated it to be worth on an EV (enterprise value) basis. This could leave new shareholders holding an attractive business, even if the absence of Lummus Technology will cost the company $255 million in lost operating income on a run rate basis. ... |
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| aus der Diskussion: | McDermott (MDR) -- Wette auf Investitionsgüter/Öl&Gas USA etc. |
| Autor (Datum des Eintrages): | faultcode (24.01.20 23:34:12) |
| Beitrag: | 34 von 42 (ID:62482959) |
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