CGG Holding and 13 affiliated Debtors filed for Chapter 11 protection with the U.S. Bankruptcy Court in the Southern District of New York, lead case number 17-11637. The Company, which is a global geophysical and geosciences services provider for the oil and gas industry, is represented by Alan W. Kornberg of Paul, Weiss, Rifkind, Wharton & Garrison.
CGG Holding is a holding company with no material assets other than its equity interests in the U.S. subsidiaries and certain miscellaneous intellectual property; it does not have any employees. CGG Holding does, however, serve as the cash pooling entity for its U.S. subsidiaries.
According to documents filed with the Court, “The precipitous drop in oil and gas prices since 2013 (the price of Brent decreasing from $110.80 per barrel at the end of 2013 to a low of $37.28 per barrel at the end of 2015) and the failure of those prices to rebound significantly since that time is well known, as are the dramatic and severe negative consequences that those changes have wrought for the industry as a whole….The Group has suffered the effects of this adverse market.”
Concurrent with the Chapter 11 filing, parent company Paris, France-based CGG, S.A. filed a Chapter 15 petition in the same court. The Company explains, “Through careful coordination between, and with input from, the Group’s various advisors, management developed a two-prong strategy for a possible in-court restructuring. Specifically, the Group and its advisors determined that, if circumstances required an in-court process, CGG S.A.–as the obligor for most of the Group’s principal indebtedness–would commence a Safeguard Proceeding in France and each of the Debtors–as the guarantors under much of that same indebtedness–would commence chapter 11 cases in the U.S. In addition, the parties determined that CGG S.A. would commence a chapter 15 case in the U.S. to recognize the Safeguard Proceeding and to aid in implementation of the overall restructuring. Finally, certain of the Debtors who are not organized under U.S. law would commence proceedings in their own jurisdictions to recognize the chapter 11 filings.”
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