Harvey Gulf International Marine

3/7/18

Texas-based offshore supply vessel operator qualified under the Jones Act has filed a prearranged bankruptcy with a deal in place with its lenders. The deal would give 97% of the reorganized equity and $350mm in take-back paper to the company's lenders, with management receiving the remaining 3% with warrants. 

What precipitated the bankruptcy? The company notes,

Beginning in 2014, as a result of severely depressed oil prices, exploration and production companies drastically cut the number of offshore exploration and drilling projects in the Gulf of Mexico, causing substantial drops in both vessel utilization and day rates. These cuts impacted the offshore supply boat and service sector by, among other things, contributing to a considerable vessel oversupply in the marketplace. Industry-wide oversupply granted substantial pricing power to exploration and production companies and deeply impacted all offshore supply boat and service market participants—including Harvey Gulf.

The only thing surprising out of this filing is that it took this long. 

• Jurisdiction: S.D. of Texas
• Capital Structure: $270mm RCF, $225mm '18 TLA, $875mm '20 TLB
• Company Professionals:
  • Legal: Vinson & Elkins LLP (Harry Perrin, Garrick Smith, David Meyer, Jessica Peet, Lauren Kanzer)
  • Restructuring Advisors: Postlethwaite & Netterville (Philip Gunn, Tuan Pham)
  • Investment Banker: Stephens Inc. (Lance Gurley, Joel Brown, Blake Woodall, Brad Neuneubel)
  • Claims Agent: Prime Clerk LLC (*click on company name for docket)
• Other Parties in Interest:
  • Private Equity Sponsor: The Jordan Company
  • Ad Hoc Group of Term Loan Lenders (ex-Black Diamond Capital Management)
    • Legal: Davis Polk & Wardwell LLP (Damian S. Schaible, Angela M. Libby, Benjamin M. Schak) & (local) Haynes and Boone LLP (Charles A. Beckham, Jr., Kelli S. Norfleet, Kelsey Zottnick)
    • Financial Advisor: PJT Partners Inc. 

Updated 3/30/18