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OFS Co. Weatherford Begins to Rebuild, Stock Relisted on Nasdaq

Girish Saligram, Weatherford CEO

Oilfield services companies (OFS) have not had an easy time over the past half-decade or so. In May 2019, OFS company Weatherford International, once the fourth largest OFS company in the world, announced it was filing for a “prepackaged” bankruptcy (see Weatherford Finally Files for “Prepackaged” Bankruptcy). In December 2019 the company emerged from bankruptcy having wiped out $6.2 billion of debt by giving new stock to debtholders and making its existing stock worthless (see Weatherford Emerges from Bankruptcy “Stronger” and “More Focused”). Now on its third CEO in three years, Weatherford is beginning to rebuild.
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OFS Company Weatherford Gets Third New CEO in 3 Years

In June, Weatherford International, the world’s fourth-largest oilfield services (OFS) company, announced that its CEO, Mark McCollum, had suddenly “left” the company (see Weatherford CEO Out Days Before Annual Meeting – 2nd Bankruptcy?). McCollum was previously the CFO of Halliburton, lured away in June 2017 to run Weatherford (see Halliburton Hires New CFO After Old CFO Left to Run Weatherford). McCollum was the second CEO over the past three years. We now have a third new CEO: Girish Saligram.
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Weatherford CEO Out Days Before Annual Meeting – 2nd Bankruptcy?

In May 2019, Weatherford International, the world’s fourth-largest oilfield services (OFS) company, finally succumbed and announced it was filing for a “prepackaged” bankruptcy (see Weatherford Finally Files for “Prepackaged” Bankruptcy). In December the company emerged from bankruptcy having wiped out $6.2 billion of debt by giving new stock to debtholders and making its existing stock worthless (see Weatherford Emerges from Bankruptcy “Stronger” and “More Focused”). Is history about to repeat itself?
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Weatherford Emerges from Bankruptcy “Stronger” and “More Focused”

In May, Weatherford International, the world’s fourth largest oilfield services (OFS) company, finally succumbed and announced it was filing for a “prepackaged” bankruptcy (see Weatherford Finally Files for “Prepackaged” Bankruptcy). Last week the company emerged from bankruptcy having wiped out $6.2 billion of debt by giving new stock to debtholders and making existing stock worthless.
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Weatherford Finally Files for “Prepackaged” Bankruptcy

We haven’t written about Weatherford International, the world’s fourth largest oilfield services (OFS) company, since last December when the New York Stock Exchange threatened to de-list their stock (see NYSE Threatens Weatherford with Delisting Stock). In the past, we’ve posted a number of stories about Weatherford’s financial troubles–and seemingly inevitable march toward bankruptcy (see our stories here). They finally succumbed. Weatherford announced Friday it will file for a “prepackaged” bankruptcy.
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NYSE Threatens Weatherford with Delisting Stock

Weatherford stock performance last 6 mo. (click for larger version)

We haven’t written about Weatherford International, the world’s fourth largest oilfield services (OFS) company, since last February. In the past, we’ve posted a number of stories about Weatherford’s financial troubles–and seemingly inevitable march toward bankruptcy (see our stories here). So far, they’ve stayed solvent. We do, however, have another twist in the plot line to tell you about. The NYSE (New York Stock Exchange) has officially notified Weatherford that its stock price has fallen below $1 per share for 30 consecutive trading days, and that if the company can’t get the share price up, the stock will be delisted. Weatherford is telling investors to stay calm, they have a plan and they have six months to comply with the NYSE directive.
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Weatherford Intl – On the Road to Recovery…or to Bankruptcy?

Schlumberger is the world’s largest oilfield services (OFS) company. Weatherford International is the world’s fourth largest OFS company. They both have operations in the Marcellus/Utica region. We’ve posted a number of stories about Weatherford’s financial troubles–and seemingly inevitable march toward bankruptcy (see our stories here). In order to stay in business, in March 2017 Weatherford formed a joint venture with Schlumberger to service fracking markets in the U.S. and Canada (see Schlumberger Throws Weatherford a Lifeline, Challenges Halliburton). Nine months later, Weatherford sold their portion of the jv to Schlumberger, liquidating their fracking business here in the U.S. (see Weatherford Sells U.S. Fracking Business to Schlumberger for $430M). Financially it’s been a wild ride for Weatherford. But perhaps the company has now turned a corner. At least, that’s what some (certainly not all) analysts are saying. Yesterday Weatherford announced a “multi-step debt financing plan” to help take the pressure off, financially. The plan is to float $600 million of new IOUs (called notes). The notes will be “senior” notes–but unsecured. Meaning if the company does go belly up, good luck with cashing in your notes. The purpose of floating the notes is to pay off older notes. Floating new debt to pay off old debt. You can’t do that forever. But apparently you can do it for at least a few years…
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Weatherford Sells U.S. Fracking Business to Schlumberger for $430M

Schlumberger is the world’s largest oilfield services (OFS) company. Weatherford International is the world’s fourth largest OFS company. They both have operations in the Marcellus/Utica region. We’ve posted a number of stories about Weatherford’s financial troubles–and seemingly inevitable march toward bankruptcy (see our stories here). However, Weatherford got a reprieve from its much larger competitor. In March 2017, Schlumberger and Weatherford announced they had formed a joint venture called OneStim, “to deliver completions products and services for the development of unconventional resource plays in the United States and Canada land markets. The joint venture will offer one of the broadest multistage completions portfolios in the market combined with one of the largest hydraulic fracturing fleets in the industry” (see Schlumberger Throws Weatherford a Lifeline, Challenges Halliburton). However, in December, Weatherford signaled they want to/need to sell off parts of the company in order to claw their way out of a $7.9 billion debt hole (see Weatherford Looks to Sell Off Pieces of the Business). First on the chopping block? The JV with Schlumberger. Weatherford announced in late December that instead of a joint venture with Schlumberger, they’re just going to sell their U.S. pressure pumping and pump-down perforating assets to Schlumberger for $430 million in cold, hard cash. In other words, Weatherford has just exited the fracking business in the U.S….
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Weatherford Looks to Sell Off Pieces of the Business

We’ve had our eye on oilfield services (OFS) company Weatherford International for some time. They are the fourth largest OFS company in the world. In 2016 they lost $3.4 billion. Not good. Earlier this year (in February) the company floated $2.5 billion in new debt and equity securities in an attempt to claw their way out of the hole they’ve dug (see Weatherford Tries to Dig Out of Debt – $2.5B Securities Offering). In March, Mark McCollum, who had been Chief Financial Officer (CFO) of Halliburton, the world’s second largest oilfield services company, left to become the CEO of Weatherford (see Halliburton CFO Leaves to Become Weatherford CEO). We haven’t heard much since, but McCollum, a bean counter by training, appears to be hard at working counting beans at Weatherford. News broke a few weeks ago that Weatherford has hired investment bank powerhouse Morgan Stanley to help sell off pieces of the company. They’re still trying to claw their way out of the debt hole. By the end of the third quarter this year Weatherford’s debt had climbed to an eye-popping $7.9 billion…
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Weatherford CEO Warns Intensive US Fracking Drains Wells Too Fast

The former CEO of the fourth largest oilfield services company in the world, Weatherford International, says “intensive fracking” being used in U.S. shale plays is becoming so effective that its draining wells faster, earlier, and that means decline rates will soon begin to skyrocket. At the Oil & Money Conference in London on Monday, Bernand Duroc-Danner said this: “If you’re going to be fracking closer zones like crazy, lots of sand, lots of water, lots of pressure, you drain the hell out of those zones which is why production goes up…But then those zones don’t get replenished…after two years, there’ll be a build up in decline rates…I am not so sure if the battle won’t be, in two years, to sustain the base as opposed to keep on growing.” What does he mean?…
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Halliburton Hires New CFO After Old CFO Left to Run Weatherford

In March, Mark McCollum, who had been Chief Financial Officer (CFO) of Halliburton, the world’s second largest oilfield services company, left to become the CEO of Weatherford, the world’s fourth largest oilfield services company (see Halliburton CFO Leaves to Become Weatherford CEO). Not long after McCollum took the helm of Weatherford, the world’s largest oilfield services company, Schlumberger, gave Weatherford a helping hand (see Schlumberger Throws Weatherford a Lifeline, Challenges Halliburton). The chain reaction (and drama) continues to unfold. Halliburton announced yesterday they’ve lured away the CFO from smaller competitor Parker Drilling Company. And now Parker is looking for a new CFO…
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Schlumberger Throws Weatherford a Lifeline, Challenges Halliburton

Schlumberger is the world’s largest oilfield services (OFS) company. Weatherford International is the world’s fourth largest OFS company. They both have operations in the Marcellus/Utica region. We’ve posted a number of stories about Weatherford’s financial troubles–and seemingly inevitable march toward bankruptcy (see our stories here). However, Weatherford may have just gotten a reprieve from its much larger competitor. On Friday, Schlumberger and Weatherford announced they have formed a joint venture called OneStim, “to deliver completions products and services for the development of unconventional resource plays in the United States and Canada land markets. The joint venture will offer one of the broadest multistage completions portfolios in the market combined with one of the largest hydraulic fracturing fleets in the industry.” Hmmm. Interesting. Here’s why. The world’s second largest OFS company is Halliburton. However, Halliburton is the world’s largest fracking company. The media is universally claiming the Schlumberg/Weatherford jv is squarely aimed at overtaking Halliburton to become the world’s largest fracking service. Can they do it? Another interesting observation: Earlier this month Mark McCollum, who had been Chief Financial Officer (CFO) of Halliburton left to become the CEO of Weatherford (see Halliburton CFO Leaves to Become Weatherford CEO). We don’t think it’s a coincidence that Weatherford is now making a play to best its larger rival Halliburton, leveraging McCollum’s knowledge of how Halliburton became king of fracking. Two thoughts on the Sclumberger/Weatherford hook-up: (1) it keeps Weatherford out of bankruptcy by infusing $535 million of cash, (2) We think it may be the prelude to a full-out sale of Weatherford to Schlumberger down the road…
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Halliburton CFO Leaves to Become Weatherford CEO

Mark McCollum, who had been Chief Financial Officer (CFO) of Halliburton, the world’s second largest oilfield services company, has left to become the CEO of Weatherford, the world’s fourth largest oilfield services company. Sounds like a good move for McCollum’s career. But is it? Since last November we’ve highlighted the financial problems at the company (see our Weatherford stories here). In February, Weatherford set about trying to raise $2.5 billion, to stay out of bankruptcy court (see Weatherford Tries to Dig Out of Debt – $2.5B Securities Offering). It makes perfect sense to hire an accountant to run the company and try to extract it from its financial woes. It’s a high stakes game for McCollum. If he’s successful in turning around the Weatherford ship, McCollum can write his ticket. If he doesn’t turn it around–well, perhaps he still has some Halliburton stock options stuffed away in a safety deposit box…
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Weatherford Tries to Dig Out of Debt – $2.5B Securities Offering

Weatherford International is the fourth largest oilfield services company in the world, employing some 44,000 people. They have a branch office in Canonsburg, PA (Pittsburgh area) with major operations in the Marcellus/Utica. Since November we’ve highlighted the financial problems at the company (see our Weatherford stories here). On Monday, after trading hours, Weatherford filed a $2.5 billion mixed securities shelf registration. What the heck is that? According to Wikipedia, “Shelf registration…is a type of public offering where certain issuers are allowed to offer and sell securities to the public without a separate prospectus for each act of offering. Instead, there is a single prospectus for multiple, undefined future offerings.” Weatherford asked the Securities and Exchange Commission if it can offer (1) 84.5 million new units (i.e. shares) at a proposed maximum offering price of $6.43 per unit to raise $543 million, and (2) offer up to $2 billion in debt or equity securities. One analyst believes the company is around $4 billion in the hole. This is an attempt to claw its way out of that hole…
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Weatherford Loses $3.4B in 2016, Announces Partnership with Nabors

Weatherford International is the fourth largest oilfield services company in the world, employing some 44,000 people. They have a branch office in Canonsburg, PA (Pittsburgh area) with major operations in the Marcellus/Utica. Since November we’ve highlighted the financial problems at the company (see Oilfield Srvs Co Weatherford in Financial Trouble). Not long after, Weatherford fired their CEO (see Weatherford Fires CEO/Chairman, CFO Interim CEO). And in December, the company announced it would stop doing any more fracking work (i.e. “pressure pumping”) in the U.S. this year (see Weatherford Shutting Down US Fracking Operations in 2017). In two separate announcements on Wednesday, Weatherford released 2016 results (not good, lost $3.4 billion) and they announced they are latching onto a competitor, Nabors, to form a joint venture, without actually calling it a joint venture, to continue drilling in the U.S….
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Weatherford Shutting Down US Fracking Operations in 2017

weatherfordRecently MDN brought you an article from the Seeking Alpha investors website, written by an analyst/investor pointing out the financial troubles at the world’s fourth largest oilfield services company, Weatherford (see Oilfield Srvs Co Weatherford in Financial Trouble). The investor writing the piece is “short” on Weatherford, meaning he’s invested money betting Weatherford’s stock price will go down–so there is a built-in conflict of interest in the article. But a few days after that article was published came the news that Weatherford’s CEO is suddenly gone (see Weatherford Fires CEO/Chairman, CFO Interim CEO), which seems to lend credibility to the Seeking Alpha writer’s thesis that the company is in trouble. Now comes word that Weatherford has suspended their U.S. “pressure pumping” (i.e. fracking) activities beginning next year. Oilfield services companies do more work than just fracking, but fracking is a a big part of what they do. According to the Upstream news service, a Weatherford official is saying the decision is a “temporary pull back”…
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