Atlantic Offshore to sell operations and units, file for bankruptcy

By Caroline Salls

Pittsburgh, April 12 – Atlantic Offshore AS completed an agreement with its main secured creditors under which it will sell most of its operations and subsidiaries to Aegopodium AS, securing continued operation and fulfillment of contractual obligations toward customers and employees, according to a news release.

Aegopodium is a newly established company that is 100% owned by H. Ogreid & Sonner AS.

After the transactions are complete, Atlantic Offshore and Norwegian group companies Atlantic Offshore Beta AS, Atlantic Offshore Delta AS and Team Atlantic AS will file for bankruptcy, the release said.

Scottish group companies Atlantic Offshore Rescue Ltd. and Atlantic Offshore Aberdeen Ltd. have become subject to a court-appointed administration process.

Given the situation of the company following the transaction, the parties to the master agreement have agreed on a reversal clause for the benefit of Atlantic Offshore and its bankruptcy estate for a period of 90 days after the transaction.

The consideration for the transaction is NOK 16.9 million. Atlantic Offshore said the new buyer group has been capitalized with NOK 70 million, of which the owner provided NOK 50 million and some secured creditors granted a convertible loan in the amount of NOK 20 million.

Challenging times

“The last few months have been extremely challenging,” Atlantic Offshore chief executive officer Roy Wareberg said in the release. Wareberg will assume a similar role in the new company.

“In the past few weeks we have continued operations under guarantees from secured creditors in the subsidiaries, and we are pleased that there is now finally a solution.

“We have secured jobs for more than 400 skilled employees and ensured continued and uninterrupted services for more than 10 offshore fields in Norway and the U.K.

“The weak market will continue to be a challenge for several years, and we need to take further steps to ensure our continued competitiveness.

“Several contracts are up for extension later this year, and we will work hard to earn the trust of our customers and secure the value of our business.”

Options evaluated

According to the release, Atlantic Offshore’s board and management have been pursuing a broad range of strategic options, financial as well as industrial, for more than a year. In February, the board presented a restructuring solution in the market that had support from the main stakeholders. However, the company said that solution was rejected by the bondholders in the ATOFF03 2013/2018 bond issue on March 4.

Since then, the company and its subsidiaries have been working on various new restructuring alternatives, including a revised capital structure involving the bond loan, as well as transaction and liquidation scenarios.

By entering into an agreement with its main secured creditors and Aegopodium, the company said it has achieved a solution that will result in continuation of the industrial operations.

Master agreement

Specifically, the master agreement involves transfer of the shares in Atlantic Offshore Gamma AS, Atlantic Offshore Alpha AS, Atlantic Offshore Epsilon AS, Atlantic Offshore Eta AS, Atlantic Offshore Zeta AS, Atlantic Offshore Management AS and Atlantic Offshore Crew AS to the buyer or its subsidiaries.

In addition, the buyer has through its subsidiaries acquired some assets and personnel in Atlantic Offshore Rescue and the shares in Atlantic Offshore Crewing Services Ltd. and Atlantic Offshore Scotland Ltd. from the administrator appointed in the United Kingdom for Atlantic Offshore Rescue.

Based in Kystabasen Agotnes, Norway, Atlantic Offshore owns and operates multirole rescue vessels and platform supply vessels.

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