Boart Longyear gets $352m financial bail out
Struggling Australian-listed provider of mining services Boart Longyear (ASX:BLY) has been saved by the bell as its main shareholder Centerbridge Partners LP agreed to provide $352 million in financial aid to cut debt and bolster its finances.
The Utah-based supplier said the restructuring plan involved up to $225 million in new "covenant lite" term loans and up to $127 million in new equity.
"We anticipate the recapitalisation will provide the company with significant liquidity to better weather the challenges of the current depressed markets for our drilling services and products and the financial strength to allow more time for those markets to recover," Boart Longyear Chief Executive Richard O'Brien said in the statement.
Boart, whose customers have been scaling back on new projects as commodities prices have been dragged down by the deceleration of China's economic growth, hired in February advisers to explore options on cutting its debt.
Boart Longyear’s shares had fallen 61% this year before today’s announcement, but closed up 53% at A$0.230 in Sydney today.