Houston-based oilfield services (OFS) giant Superior Energy Services Co. has begun voluntary Chapter 11 proceedings before the U.S. Bankruptcy Court for the Southern District of Texas to implement a proposed pre-packaged restructure plan.

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The company announced its intention to file for bankruptcy in September.

“Since the initial announcement of our planned recapitalization initiative in September, we have been encouraged by the growing consensus of the noteholders that have agreed to support the plan, as well as the ongoing strong backing and support provided by our customers and lenders,” said CEO David Dunlap. “The company looks forward to quickly emerging from the Chapter 11 cases in early 2021.”

Superior entered Chapter 11 with the support of holders of 85% of $1.3 billion of senior unsecured notes. Under the plan, noteholders would receive 100% of the equity issued and outstanding by the reorganized company. 

The plan would eliminate Superior’s debt and establish a capital structure that the “company believes will improve its operational flexibility and long-term financial health even in a low-commodity-price environment.” 

Superior adds to a growing list of North American explorers and OFS operators declaring bankruptcy since the plunge in prices and oil and gas demand brought on by the coronavirus pandemic. On average, about 10 OFS bankruptcies per month have been filed since July, with nine added in October, according to Haynes and Boone LLP.

Superior intends to operate its businesses and facilities without disruption to its customers, vendors, and employees.

Ducera Partners and Johnson Rice & Co. are acting as financial advisers, while Latham & Watkins LLP and Hunton Andrews Kurth LLP are legal counsel, and Alvarez & Marsal is restructuring adviser.