The New York-listed company said it took this decision following a prolonged slump in oil prices, driven in part by Covid-19 and its effect on the company’s business.
“While the company would have preferred to complete its financial restructuring out of court, it was unable to reach a consensual agreement with its lenders, which made filing Chapter 11 necessary to provide a single forum for all continuing conversations with its lenders,” Hermitage Offshore Services stated.
“The company anticipates that the company’s business operations and relationship with its customers and vendors will not be adversely affected by this proceeding while it works constructively with its lenders toward a consensual resolution. The company values the business of its customers and vendors and is committed to continuing its long-standing business relationships with them uninterrupted as it works through this process,” it said.
Under Chapter 11 protection, vendors of Hermitage Offshore Services are afforded ‘administrative’ status for all shipments made, or services provided, subsequent to the filing. As a result, payments for new shipments or services will be made in the ordinary course of business either by the company or one of the company’s managers, which is not part of the Chapter 11 filing.
Hermitage Offshore Services added that its customers are also afforded the ‘administrative’ status, allowing them to continue to receive uninterrupted services.
“The company’s customers and vendors have been historically paid by one of the company’s managers which is outside the Chapter 11 cases and so customers and vendors will be paid amounts due now and in the future without interruption,” it stated.
Hermitage Offshore Services has just sold two AHTS vessels which will result in a loss of approximately $4m.
The company’s remaining fleet of 10 PSVs and 11 crew boats operate mainly in the North Sea and the West Coast of Africa.
Copyright © 2020. All rights reserved. Seatrade, a trading name of Informa Markets (UK) Limited.