DIP financing over $2.81 billion had been provided for McDermott during its restructuring under Chapter 11 bankruptcy. The equity-for-debt plan agreed with the court for the Lummus sale would eliminate more than $4.6 billion of McDermott’s debt.
DIP In January, subsidiaries of McDermott agreed to sell Lummus to The Chatterjee Group and Rhône Capital for a base purchase price of $2.725 billion, subject to higher or otherwise better bids received through a court-supervised auction process.
Most of McDermott’s debt was incurred by its $6 million purchase of rival Chicago Bridge & Iron (CB&I) in 2018. Eager to revive its financial structure, McDermott had been seeking for a higher bid during the solicitation period but did not get a better offer. It consequently cancelled another bidding auction previously scheduled for Monday, March 9.
McDermott said the sale hearing to confirm the sale of Lummus Technology to the joint partnership will take place on Thursday, March 12, 2020, at 9:00 am.
Under the terms of the Agreement, McDermott will have the option to retain or purchase, as applicable, a 10 percent common equity ownership interest in the entity purchasing Lummus Technology.