Noble Corporation (NYSE: NE) filed for Chapter 11 bankruptcy on Friday. The offshore driller (not to be confused with oil and gas producer Noble Energy, which Chevron recently agreed to acquire) has entered into a restructuring support agreement with two groups consisting of its largest bondholders. The deal will eliminate all $3.4 billion of its existing bond debt.
Noble will use the bankruptcy process to enable bondholders to exchange their bond holdings for equity in the reorganized company. In addition to that debt exchange, bondholders have also agreed to invest an additional $200 million into the company via new second-lien notes. Meanwhile, it has secured a $675 million credit facility with other lenders, providing it with additional liquidity once it emerges from bankruptcy. Noble's improved balance sheet and liquidity following this process will allow it to operate and invest in its assets.
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