9th Mar 2016 10:17
LONDON (Alliance News) - The Irish High Court has appointed an interim examiner to troubled oil and gas company Petroceltic International PLC after one of the London-listed company's shareholders filed a petition to try and protect its investment.
Petroceltic, which has a mountain of debt it is unable to pay, was immediately placed under protection from its creditors last week after a shareholder filed the petition asking the Irish Court to appoint an examiner to the company.
The Irish Court has now appointed Michael McAteer of Grant Thornton Ireland as the examiner of Petroceltic, giving him the task of holding discussions with the company's creditors in an attempt to restructure the business so the company can become a sustainable operation.
That process is expected to last around 100 days, and Petroceltic shares are likely to remain suspended throughout the process after requesting the suspension Monday due to the "significant uncertainties" within the company.
Worldview EHS International Master Fund, which has a 13.7% stake in the company, launched the petition to the Irish Court only hours after a takeover bid for the company launched by Worldview Capital Management SA was rejected by one of Petroceltic's other shareholders.
Petroceltic did not authorise the petition launched by its shareholder and was seeking legal advice over the matter, claiming it had "substantially agreed" a deal with its lenders to secure another extension to its hefty debt repayment deadline. The company claimed the petition caused that agreement to collapse.
Without that extension, Petroceltic's debt was due to be repaid last Friday, but the creditors will not be able to take action against the company, if they so wished, due to the protection provided by the Irish Court ruling.
Petroceltic did not comment on the appointment of the examiner on Wednesday.
The full hearing of the petition will be held on April 4.
In the meanwhile, Petroceltic is likely to continue with its strategic review in tandem with the examiner-ship to try to find a suitable buyer, partner or financier that could potentially save the business.
Although Petroceltic's cash balance currently stands at USD33.4 million, USD26.4 million of that is held in local currencies and is not readily convertible - giving it an effective cash balance of only USD7.0 million.
Its Senior Debt Facility is to the tune of USD230.0 million.
By Joshua Warner; [email protected]; @JoshAlliance
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