Diamond Offshore secures creditor support for Chapter 11 exit financing

Diamond Offshore Drilling Inc. entered into an agreement with its creditors that is designed to deleverage its balance sheet and finance its emergence from Chapter 11 bankruptcy.

Through the plan, Diamond Offshore looks to equitize its senior unsecured notes, which should result in over $2.1 billion in debt reduction, according to a Jan. 25 news release.

Certain holders of senior unsecured notes agreed to invest up to $110 million in new capital through first lien, last out exit notes, while certain holders of revolving credit facility loans will provide exit financing facilities through a $300 million to $400 million first lien, first out revolving credit facility and a $100 million to $200 million first lien, last out term loan facility. Diamond Offshore said over 70% of holders of its senior unsecured notes and revolving credit facility loans agreed to the plan.

Diamond Offshore filed for Chapter 11 bankruptcy protection in April 2020.