Turdwater borrowing $600M from Peter to pay Paul

That is a awful lot of debt to assume NOT for capital expansion and a rather large wager to place that the market will improve come the near future. We all know that someone if going to crash and burn here soon!

[B]Tidewater draws $600 million maximum from revolver[/B]

MARCH 16,2016 — Offshore services giant Tidewater Inc. (NYSE: TDW) reported yesterday that it has borrowed $600 million under its revolving credit facility, the maximum amount available under the facility. The funds are intended to be used for general corporate purposes and to enhance the company’s liquidity position and financial flexibility.

The company also warned that by as early as fiscal 2017, it might “cease being in compliance with interest coverage ratios contained in certain of its debt facilities.”

“Like the entire energy services industry, Tidewater continues to face challenges arising from the decline in the level of offshore oil and gas drilling and development activity around the world,” said President and CEO Jeff Platt. “Moreover, the uncertainty surrounding the future direction in oil and gas prices has resulted in our clients’ continued reduction in their capital budgets, spending and activity levels. Tidewater previously announced the suspension of its quarterly dividend and common stock repurchase program and the realignment of its operating structure. These and other steps have been taken to enhance liquidity, reduce costs and reduce capital expenditures, all to best position the company for an eventual industry recovery. We are in compliance with all financial covenants and other terms of the revolving credit facility and our note indentures. This is a predicate to our being able to draw on the revolving credit facility.”

Tidewater said that, as previously disclosed in its December 31, 2015 Form 10-Q and discussed on the February 3, 2016 quarterly earnings call, “the current deterioration of the offshore energy market has had a corresponding negative effect on the company’s vessel revenue and other financial metrics. As a result, it is possible that in future quarters, and possibly as early as fiscal 2017, the company may cease being in compliance with interest coverage ratios contained in certain of its debt facilities and senior note indentures. Failure to meet the required interest coverage ratios would be an event of default under certain of the company’s debt facilities. The company is in dialogue with the principal lenders and noteholders to obtain amendments and/or waivers of these covenants in advance of any such default occurring, with the goal of finalizing any amendments and/or waivers prior to any possible covenant breach. Obtaining the covenant relief the company is seeking will require the company to successfully harmonize the interests of the banks and the noteholders.”

maybe they are going to buy someone?

Getting cash to buy someone obviously. Chouest maybe? Hornbeck’s stock is valued at $330 million today.

If they buy anyone it will be Harvey or Gulfmark it won’t be the other two.

Tidewater is operating world wide and getting more into big modern boats, both AHTS and PSVs. They already have a company operating in Norway under NOR flag (Troms Offshore) and are building large AHTSs and PSVs to Norwegian design, without skimping on the machinery and equipment this time around.

What they haven’t got into in a big style is the more specialized vessels for Subsea work, CSVs e, IMR vessels etc.
I wouldn’t be surprised if they have their eyes on getting into that market by buying up a company with a fleet of such vessels cheaply, rather than buying or building individual vessels. (Just guessing, no insider info)

Tidewater really wants to be in IMR though. They really wanted the Brewster Tide to get some IMR work and they are currently chartering one of those Bordelon LIV vessels. I think they see that as the next logical step forward in the GoM given the age of the infrastructure…

[QUOTE=SomeGuy;182754]Tidewater really wants to be in IMR though. They really wanted the Brewster Tide to get some IMR work and they are currently chartering one of those Bordelon LIV vessels. I think they see that as the next logical step forward in the GoM given the age of the infrastructure…[/QUOTE]

Tidewater is unsurpassed in its enthusiasm for developing highly specialized equipment to meet its customers’ demands. Tidewater, as an example, was selected by the U. S. government to provide support in launching geo-stationary radar equipment for drug interdiction in the Gulf of Mexico.

Our unique vessels are capable of supporting a broad range of specialized marine applications, including, but not limited to:

Cable laying
Diving support
FPSO support
Line-handling
Platform maintenance
ROV support
Seismic support
Well stimulation

Not sure if I agree entirely with their enthusiasm and uniqueness of their vessels. Most are built as cheaply as possible and to standard designs.

But they have shown interest in getting modern vessels lately and do not put outdated machinery and equipment on them any more (Refr. the 4 Laborde-type AHTS, built in China in 2004-06 to VS design, but equipped with GE 752 D/C motors and 52 SCRs (from memory) to power them)