Nostrum Oil & Gas shares slide amid plans to reduce stake of its shareholders
Shares in Nostrum Oil & Gas (Nostrum) tanked this morning, plummeting 38 per cent on the London Stock Exchange’s main market after the company suggested reducing the influence of its stakeholders.
The troubled fossil fuel specialist said current talks regarding its potential financial restructuring include a significant reduction in the stake of its shareholders.
The firm is entertaining the prospect of a debt-for-equity swap, as it aims to materially reduce its financial indebtedness.
Nostrum entered into a forbearance agreement with informal ad hoc noteholder group AHG in October 2020.
Since then, it has engaged in discussions with AHG and its advisors over reducing indebtedness, extending debt maturities and lowering the group’s cost of funds.
This has included conversations about the proposed restructuring of its finances and the group’s existing notes.
The restructuring is linked to the company’s $725m eight per cent senior notes due in July 2022 and its $400 million seven per cent senior notes due February 2025.
“The restructuring work is progressing, and the company will make further announcements when appropriate,” it said.