Solstad Offshore has hailed a "new beginning" for the company as shareholders voted through a $2bn debt restructuring more than five years in the making.
A total of 48.07m new shares will be issued to certain secured lenders, bondholders and other stakeholders with payable claims.
Debt worth NOK 9.7bn ($1.04bn) is being swapped into stock at a conversion price of NOK 3.74 per share.
This involves a big haircut, as NOK 202 in liabilities qualifies a creditor for one new share.
As part of the deal, a 1,000 to one reverse stock split is being carried out, with total shares now numbering 291.5m.
The stock was up 26% at NOK 0.47 after trading resumed in Oslo on Tuesday following the vote. The market cap is just NOK 114m.
Long process ends
Chief executive Lars Peder Solstad told TradeWinds: "It has been a long process with many stakeholders involved."
He added: "It is good to have reached this point, and I am happy with the result."
Another 24.5m Solstad shares are being sold to key "industrial shareholders".
These are existing investors Kjell Inge Rokke through his Aker Capital, John Fredriksen's private Hemen Holding, the Solstad CEO's Jarsteinen company and Espedal & Co, controlled by chairman Harald Espedal.
Between them they will have a stake of 45.8% to counteract the influence of the banks and bondholders, but this could rise to around 52% due to options granted to the boss.
It had previously been announced that the key investors were rebuilding their stakes to a combined 35%.
Boss rewarded
The Solstad CEO has been awarded 5.04m stock warrants as part of his management incentive plan.
Subscription prices for the industrial investors are between NOK 2.68 and NOK 2.80, raising gross proceeds of NOK 66m for Solstad.
The shipowner is also issuing 4.42m warrants for new shares to some lenders at a conversion price of NOK 3.74.
And the company will issue a convertible loan worth NOK 2.8m to Rokke, Fredriksen and the CEO's companies.
Hemen Holding will not be offered a board position after 31 December 2021 and will be released from a three-year share lock-up period at that point.
Solstad is also launching a subsequent offering of 1.33m new shares at NOK 2.80 to raise NOK 3.74m.
The company has engaged Arctic Securities as manager of the placements and offerings.
Fresh start for shipowner
The chief executive said the votes mark a "new beginning" for the company.
"The oil service industry was hit hard by the activity drop after the drastic fall in oil prices in 2015, and the company was left with no other choice than to start a process with creditors and shareholders to restructure the company's balance sheet," Solstad added.
This was then compounded by the Covid-19 pandemic and further drops in the oil price earlier this year.
He said: "I am very grateful to everyone who has contributed in this process, including creditors, shareholders, advisors and not least the dedicated team of internal resources from Solstad Offshore."
He added the company is now significantly stronger and can continue to be a reliable partner for clients, suppliers and employees.
Solstad now has about 100 vessels involved with the oil and gas sector, as well as offshore wind activities worldwide.
There are more than 3,500 highly skilled employees, the company said.
"Solstad Offshore will remain one of the main players in the offshore vessel industry going forward," the chief executive pledged.
Aker Capital, together with Rokke's shipowning company Ocean Yield, will have 25.6% of the company, against nearly 41% previously. The Norwegian tycoon will be the biggest shareholder.
Hemen Holding will have 9.3%, down from 24% earlier this year, while Fredriksen's listed shipowning company SFL Corp has acquired a 6% slice of the company through a deal involving settlement of charters of offshore vessels to Solstad.
The Solstad CEO and his family have 3.9%, compared to 11.5% previously, but the chief executive can increase this to 10%. Espedal has 0.9%.
Nordea takes big stake
Solstad said in a separate filing that Nordea Bank has converted debt and interest into 5.39m shares, equalling 7.4% of the equity.
DNB Bank also disclosed it now owns 11.45% of the company.
Espedal, Frank Reite, Peder Sortland, Thorhild Widvey, Ellen Solstad and Ingrid Kylstad will constitute the board of directors.
The plan announced earlier this year envisioned 37 non-core vessels being sold, leaving Solstad with a fleet of 90 units.
The company logged a net loss of NOK 805m in the second quarter, compared with NOK 342.5m in 2019. Revenue was NOK 1.33bn, against NOK 1.37bn a year ago.
The six-month loss stood at NOK 3.05bn.
The shipowner's previous structure dated from 2017, when Fredriksen's Deep Sea Supply and domestic owner Farstad Shipping were merged into Solstad in a deal involving tycoon Rokke. Solstad had already taken over Rem Offshore, following the slump in the offshore support vessel market.
