Petrofac Announces Financial Restructuring Agreement

On December 23, 2024, Petrofac Limited unveiled a binding Lock-Up Agreement with key financial creditors, aimed at a comprehensive restructuring to enhance the Group's financial health. The deal, first revealed in September 2024, involves a new equity raise and agreements with core clients, promising at least $325 million in fresh funding. After obligatory repayments and costs, this adds an estimated $195 million to Petrofac’s liquidity.

Under the restructuring, $772 million of existing debt will convert to equity, reducing overall debt to around $250 million post-restructuring. Shareholders will see diluted yet retained value, and various agreements promise a future-proof financial structure. Subject to approval, the restructuring should wrap by Q1 2025.

The strategic focus aims to restore liquidity and establish a sustainable financial framework, tackling past contractual challenges intensified by COVID-19. This move seeks to safeguard Petrofac’s operations and inaugurate a growth phase.