Petrofac files for administrators but operations to continue

(Alliance News) - Petrofac Ltd on Monday said it has applied to the High Court of England and Wales to for the appointment of administrators.

The London-based energy infrastructure company and contractor, which works with firms such as Shell PLC and BP PLC, said the group's operations will continue to trade while its ultimate holding company alone enters "a targeted administration."

This follows a contract cancellation by TenneT Holding BV, the Dutch state-owned electricity system operator, which has terminated work assigned to Petrofac on a two-gigawatt project in the Netherlands.

The company's shares have been suspended since May, due to the delayed release of its 2024 results.

Back in 2021, the company pleaded guilty to multiple counts of failing to prevent bribery dating back to 2011, in a case brought by the UK Serious Fraud Office. Two former Petrofac senior executives, Marwan Chedid and George Salibi, are scheduled to go on trial for bribery in October next year.

Petrofac noted that it is "actively" working with "key creditors" on alternatives to administration, such as restructuring, mergers and acquisitions. Creditors include an "ad hoc group of noteholders, who are supporting the group with continued forbearance arrangements whilst alternative options are explored," Petrofac said.

It also noted support from a revolving credit facility and "term loan lenders who continue to extend maturities on a rolling basis."

"When appointed, administrators will work alongside executive management to preserve value, operational capability and ongoing delivery across the group's operating and trading entities," Petrofac added.

Around 2,000 of the company's 7,000 employees are based at its Scottish North Sea operational hub, according to PA Media.

By Holly Munks, Alliance News reporter

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