Awwal 09, 1432 H/Feb 12, 2011, SPA -- Seahawk Drilling Inc. said it is filing for bankruptcy protection and plans to sell its fleet of offshore oil rigs, boats and other equipment to a competitor for $105 million, according to AP. Houston-based Seahawk, which announced the deal Friday, has been hurt by a slowdown in Gulf of Mexico drilling following the BP oil spill last April. The government halted drilling in deep waters and imposed tough new rules that have sharply curtained all energy exploration in U.S. waters. Hercules Offshore Inc. plans to buy most of Seahawk's assets using 22.3 million shares of its stock, $25 million in cash to retire Seahawk debt and additional cash for working capital. At the Feb. 10 closing price of $3.62 per share, the deal's value is $105 million. The asset sale will be carried out through a Chapter 11 bankruptcy protection filing in which Seahawk will seek expedited hearings to obtain court approval. The deal is expected to close in the second quarter of this year. In November, Seahawk said it was considering a merger or asset sales to bolster shareholder return following the drilling slowdown. It reported a third-quarter loss of $32.1 million and sharply lower revenue. Hercules' purchase of Seahawk's assets creates a larger company with a more diverse fleet and greater operational flexibility. Seahawk owns 20 rigs. Hercules, also based in Houston, owns 30 rigs and other equipment. It also provides well service, platform inspection, maintenance, and decommissioning operations. Seahawk said it obtained a $35 million credit facility to help fund operations until the transaction closes. The company expects its operations to continue without interruption. Shares rose 43 cents, or 5.4 percent, to close Friday at $7.90. They lost $3.90 in after-market trading, however. Shares have traded in a range of $6.79 and $23.07 in the past year. Hercules shares were unchanged Friday at $3.62. They gained 14 cents in after-market trading.
