OSLO, Nov 29 (Reuters) - The biggest shareholder in Fred. Olsen Energy on Thursday proposed changing the company’s name, days after it blamed the latest oil price plunge for the collapse of a rig sale deal to raise money to cut debts.
The company, controlled by one of Norway’s richest families, the Olsens, has been trying to restructure debts of about $580 million and the refinancing plan included the sale of its newest rig Bolette Dolphin.
But the plan to sell Bolette Dolphin for $340 million failed after a buyer pulled out of the talks, the company said on Tuesday.
“The potential buyer of the Bolette Dolphin has withdrawn from the sales process given the significant change in oil and equity prices coupled with the uncertainty around the restructuring and sale process,” Fred. Olsen said at the time.
Oil services companies like Fred. Olsen have borne the brunt of a downturn in the oil industry where oil companies had to cut spending to cope with a fall in oil prices. An oversupply of oil rigs added to the oil services industry’s pain by lowering day rates for rig hire.
A number of Fred. Olsen’s rivals have been forced out of business or had to restructure.
The oil price has since recovered, with North Sea oil hitting a four-year high of $86 per barrel in October, boosting rig owners’ hopes that oil companies will start spending again to replenish reserves.
But in less than two months, oil prices have fallen below $60 a barrel on concerns about a supply glut. The price drop also comes at the time of year when oil companies usually plan next year’s budgets.
Rival drilling rig firm Seadrill , which emerged from U.S. Chapter 11 bankruptcy in July, has downplayed the impact of the recent oil market plunge.
“The recent volatility in oil crisis has little bearing on how the vast majority of our customers invest. Their time horizon is much longer,” Seadrill Chief Executive Anton Dibowitz said during an earnings call on Tuesday.”
Both Seadrill and Fred. Olsen Energy said in their outlooks that a broad rig market recovery has been taking place, and prices should rise next year.
On Thursday, Fred. Olsen called an extraordinary shareholders meeting on Dec. 20 to approve a proposal to change its name to Dolphin Drilling, the name associated with large finds on the Norwegian continental shelf, including the country’s largest gas field Troll.
The proposal came from its major shareholder Bonheur , an investment company of the Olsen family, which also has investments in renewable energy, cruise shipping, and media.
The company was not immediately available to comment on the reason for the proposed name change.
Fred. Olsen Energy also owns the Harland & Wolff yard in Northern Ireland that built the RMS Titanic. (Editing by Jane Merriman)