Sete Brasil will publish until the end of this week public announcement for the sale of the four rigs being built at the Jurong and Brasfels shipyards and will have their charter contracts with Petrobras. The publication of the edict is included in the list of requirements of the group’s judicial recovery plan and the delivery of the proposals will be scheduled for the second half of February, exactly 30 days after the release of the edict.
The announcement will determine a base price for the sale of the four units, stipulated based on the PRJ approved in early November and that allows the repayment of part of the debts with the creditors. Sete Brasil does not report the value, but during the direct negotiation process, a price of US $ 1.25 billion was set for the package of the four platforms.
The analysis of the proposals will be made on the basis of the best price. If they do not reach the base value, the operation can be carried out, as long as the price is approved by the creditors.
With the launch of the edict, any interested company can enter the tender, as long as it meets the qualification requirements, which determine, among other things, experience in the operation in deep waters. The sale of the four units had already been negotiated for months by Sete Brasil, having advanced to the stage of unsuccessful proposals.
Officially, Sete Brasil has not revealed so far the names of the units that will go on sale. The information will be disclosed in the notice, but it is taken for granted that the units selected are NS Arpoador and NS Guarapari (Jurong) and SS Urca and SS Frade (Brasfels).
The amount collected from the sale of the charter and operation contracts of the units will be used to pay for the completion of the works in the two shipyards. The difference in amounts will be entirely directed to the payment of part of the debt. The total debt of Sete Brasil amounts to almost R $ 20 billion and estimates are that 10% of this amount be removed.
The sale process is being coordinated by Alvarez & Marsal Advogados, that has been advising Sete Brasil. Although the deadline for submitting proposals is tight, especially for potential new entrants, there is no anticipation of postponement as the group is running out of time to implement its recovery plan.
During the direct negotiation phase, four companies showed interest in the transaction and submitted unsuccessful proposals. Bets on prospective opponents on the occasion included the names of Seadrill, Ocean Rig, Borr Drilling and Transocean. Sources linked to the lawsuit say that some proposals would have come close to the base value, but that all companies presented constraints.
The attractiveness of the sale operation of the four units of Sete Brasil divides opinions in the market. The risk of business compliance is considered high and some companies do not rule out the possibility that the equipment may be confiscated over the course of business. Another negative factor is that the negotiation around the completion of the works will be the responsibility of the future buyer of the unit. On the other hand, the four rigs have long-term contracts with charter time of ten years and daily rates of US $ 299 thousand / day, high values for the current industry average.
The judicial reorganization plan of Sete Brasil was approved after 14 consecutive adjournments of the General Meeting of Creditors. The approval was unanimous, without any creditor voting against, although five abstentions were registered by Banco Bradesco / Grand Cayman Branch, Banco Santander (Brazil) / Grand Cayman Branch, Luce Venture Capital / Drilling Series, Deutsche Bank Trust Company America and Stocche, Forbes, Padis, Filizzola.
The list of creditors of the group involves 22 companies, including the 12 shareholders – BTG Pactual, Luce, EIG Global Energy Partners, Lakeshore, Previ, Petros, Funcef, Valia and FI-FGTS, Santander, Bradesco and Petrobras – five banks lenders and five shipyards. The group’s financial problems began more than three years ago, along with the first scandals of the Lava Jato operation.
Sete Brasil was created in 2010 to meet the demand for Petrobras pre-salt rigs. At the time, the group signed a contract with the oil company to charter a total of 28 rigs, most of which did not even began construction.
Source: Brasil Energia