Valaris, offshore drilling contractor with the world’s largest fleet, has filed for bankruptcy protection in an attempt to restructure its debt. Valaris said on Wednesday that it voluntarilyfiled for a Chapter 11 financial restructuring in the United States BankruptcyCourt for the Southern District of Texas. “Valaris will continue to serve our customers uninterrupted through this process, delivering safe and reliable operations, through its highly-capable rig fleet. “We have taken several steps to right-size and streamline our organization in line with our goal to be the offshore drilling cost leader. Now, we intend to use this restructuring to complement these measures to create a stronger financial structure for the company. Valaris also faced delisting from the New York Stock Exchange in April after its stock fell under $1. As far as the restructuring process is concerned, the company entered into restructuring agreements with approximately 50 per cent of its noteholders, to undergo “a financial restructuring that is intended to reduce its debt load substantially, support continued operations during the current lower demand environment, and provide a robust financial platform to take advantage of market recovery over the long term“. According to the offshore driller, it aims to pursue an efficient restructuring process and exit Chapter 11 “as soon as possible” and is confident that a comprehensive financial restructuring is “in the best interest of the company and its stakeholders in the long-term”. Valaris added that would work with itsother creditors and stakeholders who have not signed the restructuring supportagreement to advance the company’s efforts to restructure its balance sheet. The agreement will fully equitize thecompany’s pre-petition revolving credit facility and unsecured notes, a fullybackstopped rights offering to noteholders for $500 million of new securednotes, the effective cancellation of existing equity interests in the companyin exchange for, in certain circumstances, warrants for post-emergence equityand payment of trade claims in full in cash. “We appreciate the continued support of all of our stakeholders throughout this process, particularly our employees who continue to provide excellent service to our customers amid challenging market conditions […]”. It claims that it will have “one of the best balance sheets in the offshore drilling industry” after consummation of the contemplated restructuring transactions. Tom Burke, president and CEO of Valaris, said: “The substantial downturn in the energy sector, exacerbated by the COVID-19 pandemic, requires that we take this step to create a stronger company able to adapt to the prolonged contraction in the industry and to continue to enhance our position as overall market conditions improve. In related company news, Valaris booked a $3 billion loss in the first-quarter over rig impairments. During the spring, the company faced terminations for several of its drilling contracts on two occasions. Valaris further stated that it wasconfident of running its business normally since it has around $175 million incash. Also, certain noteholders will provide the company with an additional$500 million of liquidity, with an option to have no cash interest, to supportits operations throughout the Chapter 11 process.