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Valaris plc Files for Bankruptcy; Secures DIP Financing

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   |    Wednesday,August 19,2020

Valaris plc has entered into a binding Restructuring Support Agreement (RSA) and Backstop Commitment Agreement (BCA) with approximately 50% of its noteholders.

To implement the terms of the RSA and the BCA, Valaris voluntarily filed for a Chapter 11 bankruptcy.

The Company has approximately $175 million in cash and committed Debtor-in-Possession (DIP) financing from certain of its noteholders to provide the Company with an additional $500 million of liquidity, with an option to have no cash interest, to support its operations throughout the Chapter 11 process.

Tom Burke, President and Chief Executive Officer 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.

"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 will continue to serve our customers uninterrupted through this process, delivering safe and reliable operations, through its highly-capable rig fleet."

"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, while upholding the Valaris values of integrity, safety, excellence, respect, ingenuity, and stewardship."

Kirkland & Ellis LLP and Slaughter and May are serving as legal advisors to Valaris in connection with the restructuring. Lazard Ltd. is serving as Valaris' investment banker and Alvarez & Marsal North America LLC as its restructuring advisor. Kramer Levin Naftalis & Frankel LLP and Akin Gump Strauss Hauer & Feld LLP are serving as legal advisors to the Consenting Noteholders, and Houlihan Lokey Inc. is serving as financial advisor.


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