Offshore tech co ION Geophysical OK’d to faucet personal bankruptcy bank loan

The U.S. District Bankruptcy Court docket for the Southern District of New York. REUTERS/Brendan McDermid

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  • ION aims to either promote property or shift fairness to collectors
  • Lingering pandemic effects led to profits decline

(Reuters) – Offshore strength technology companies enterprise ION Geophysical Corporation on Wednesday secured temporary court approval to entry a financial loan to fund functions through its personal bankruptcy.

U.S. Individual bankruptcy Decide Marvin Isgur in Houston accepted on an interim foundation ION’s request to tap a $2.5 million loan all through its first court listening to due to the fact submitting for Chapter 11 protection on Tuesday. Isgur will take into consideration final approval of the mortgage on Could 9.

The Houston-centered publicly traded organization, which has $139 million in debt, has lined up a prearranged restructuring system that allows it to possibly examine asset product sales or reorganize by placing a group of junior lenders in manage of the firm and having to pay senior loan providers in comprehensive.

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ION, which supplies seismic imaging and data solutions to offshore electrical power corporations, blamed the lingering effects of the decrease in electrical power prices caused by the COVID-19 pandemic for its economic troubles. However prices improved in 2021, ION’s revenues ongoing to decrease, which it said was because of in aspect to energy companies continuing to rein in expending.

ION reported $118 million in earnings for 2021. It employs 182 men and women, down about 45% considering that early 2020.

The proposed strategy is supported by all of the company’s senior loan companies, which are owed about $15.6 million, and 80% of a junior team of lenders that are owed about $116.2 million.

The corporation gained a $6.9 million loan beneath the federal government’s Paycheck Defense System, which was built to support small businesses for the duration of the first 12 months of the COVID-19 pandemic. The personal loan was forgiven in June 2021, in accordance to court papers.

The scenario is In re ION Geophysical Company, U.S. Bankruptcy Courtroom, Southern District of Texas, No. 22-30987.

For ION: Daniel McGuire, Timothy Walsh, Katherine Preston and Laura Krucks of Winston & Strawn

For ad hoc group of initially lien lenders and next lien noteholders: Ryan Preston Dahl, Matt Roose, Uchechi Egeonuigwe and Katharine Scott of Ropes & Grey

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