Tervita Skips Interest Payment, Says It’s in Lender Talksby
Company misses $18.3 million due on debt maturing in 2018
‘No assurances’ as oil-field servicer has 30 days for deal
Tervita Corp. said it skipped an interest payment and will use a 30-day grace period to negotiate with its lenders.
The Calgary-based oil-field services company failed by Monday’s deadline to pay an $18.3 million interest payment on its 11.875 percent senior subordinated notes due in 2018, it said in a statement. The missed payment doesn’t constitute a default and the company has 30 days to make the payment, it said. Tervita has about C$3 billion of debt, according to data compiled by Bloomberg.
"No agreement regarding a recapitalization transaction has been entered into at this time, and no assurances can be given that the company’s efforts will result in any such agreement," Tervita said in the statement. "The company remains and intends to remain current with its suppliers, trade partners and contractors."
Cam Hantiuk, a company spokesman, declined to comment in an e-mail on Tuesday.
Tervita has sufficient liquidity to maintain operations, including nearly C$400 million ($310 million) in cash and a C$350 million revolving credit facility, the company said in the statement.
Tervita said in January it was working with advisers to consider options to manage its debt load, including asset sales and restructuring. Closely held Tervita has struggled with its finances as energy producers have slashed drilling budgets amid the nearly two-year oil rout, which has seen prices drop 55 percent since June 2014.