Global Geophysical Services Files for Bankruptcy in TexasJoel Rosenblatt and Erik Larson
Global Geophysical Services Inc. a seismic-data provider for some of the biggest oil and gas companies, filed for bankruptcy, blaming competition in the U.S. market and saying it’s now focusing attention overseas.
The company, with assets and debt of about $469 million each, is considering options including selling assets or merging with another company as it seeks to reduce debt incurred in recent years, it said yesterday in a Chapter 11 filing in U.S. Bankruptcy Court in Corpus Christi, Texas.
“We are beginning the process of developing a consensual financial restructuring plan that will reduce the company’s debt and align our financial profile with the strength of our operations,” Chief Executive Officer Richard White said in a statement.
The bankruptcy comes as spending on seismic data by the oil and gas industry is expected to grow 7 percent to 9 percent in international markets compared with less than half that in the U.S., Global Geophysical said in court papers. The Missouri City, Texas-based company recently shifted some operational and administrative functions to Brazil and Dubai, it said.
The bankruptcy includes several of Global Geophysical’s units including Autoseis Inc. Its foreign subsidiaries weren’t included and won’t be subject to the requirements of U.S. bankruptcy law, the company said in the statement. A hearing in the case is scheduled for tomorrow.
Global Geophysical “continued to be burdened by significant debt incurred over the past several years,” according to the statement.
In the past year and a half, nine of the top 12 senior management positions at the company were filled with new people who began investing less in “speculative” projects and required more money up-front from clients for surveys, according to court filings. The company’s employee count was cut by 35 percent over the same period and is now about 800, it said.
Global Geophysical and its subsidiaries operate in locations including Alaska, Colombia, Brazil, Iraq and Kenya, according to court papers.
The company is focusing more attention overseas as its non-U.S. revenue increases, Chief Financial Officer Sean Gore said in a court filing.
It has about $250 million in publicly traded unsecured bond debt, all of it 10.5 percent senior notes due in 2017 and issued in 2010 and 2012 with Bank of New York Mellon Corp. as trustee, according to court papers.
Global Geophysical is seeking court approval of a $60 million loan to finance the company in bankruptcy, according to the statement.
The case is In re Global Geophysical Services Inc., 14-bk-20131, U.S. Bankruptcy Court, Southern District of Texas (Corpus Christi).