ECOPETROL S.A. informs about the decision adopted by the Dutch Court on the restructuring process of CB&I N.V., a subsidiary of McDermott International Ltd.

Rhea-AI Summary

Ecopetrol S.A. announces the approval of the financial restructuring plan for Refinería de Cartagena S.A.S. by the District Court of Amsterdam, involving convertible preferred shares from McDermott International Ecopetrol asserts its rights and those of Colombia, showcasing its significant presence in the energy sector.

Insights

Financial Analyst

The approval of the financial restructuring plan for Chicago Bridge & Iron Company by the Amsterdam District Court has significant implications for Ecopetrol S.A. and its subsidiary Refinería de Cartagena S.A.S. (Reficar). The acquisition of convertible preferred shares representing 19.9% of McDermott International Ltd. by Reficar is a strategic investment that could potentially lead to substantial influence over McDermott's operations. This is particularly relevant given McDermott's global presence in the engineering services sector for the energy industry, which aligns with Ecopetrol's core business activities.

From a financial perspective, the convertible nature of the preferred shares provides Reficar with a future option to convert these shares into common stock, potentially resulting in a significant equity stake in McDermott. This could enhance the value of Ecopetrol's investment portfolio and provide a strategic advantage in terms of collaborations and partnerships in the energy sector. However, the success of this investment will largely depend on McDermott's performance post-restructuring and its ability to capitalize on the growing demand for low-carbon solutions.

Energy Industry Analyst

Ecopetrol's involvement in the restructuring of CB&I N.V. through Reficar underscores the company's commitment to diversifying its portfolio and strengthening its position in the global energy market. The energy sector is rapidly evolving with a growing focus on low-carbon technologies and sustainable practices. McDermott's specialization in these areas could provide Ecopetrol with valuable insights and technologies that can be leveraged to maintain a competitive edge.

Furthermore, the equity stake in McDermott could facilitate access to new markets and projects, especially in the 54 countries where McDermott operates. This move is in line with Ecopetrol's strategy to expand its international footprint and could lead to increased revenue streams from projects outside Colombia. However, the integration of such projects into Ecopetrol's existing operations will require careful management to ensure synergies are realized and risks are mitigated.

Market Research Analyst

The announcement of this restructuring plan may have varying effects on the stock market. Investors may view Ecopetrol's acquisition of a stake in McDermott as a positive diversification strategy, potentially leading to a more robust and resilient business model. The market often reacts favorably to companies that are proactive in securing strategic investments, particularly in industries that are poised for growth, such as low-carbon energy solutions.

On the other hand, the long-term success of this investment is contingent upon the recovery and future performance of McDermott post-restructuring. Investors will be monitoring the implementation of the restructuring plan closely and any signs of underperformance could impact investor sentiment towards Ecopetrol's stock. It's essential to consider the broader market trends and investor appetite for energy sector investments, particularly in the context of the transition towards sustainable energy sources.

BOGOTA, Colombia, March 22, 2024 /PRNewswire/ -- Ecopetrol S.A. (BVC: ECOPETROL; NYSE: EC) informs that Refinería de Cartagena S.A.S. ("Reficar") has been notified of the decision to approve the alternative financial restructuring plan of Chicago Bridge & Iron Company N.V. ("CB&I N.V."), reached today, March 21, 2024, by the District Court of Amsterdam in the Netherlands, in charge of the restructuring process initiated on September 8, 2023 by McDermott International Ltd. ("McDermott"), on behalf of its subsidiary, CB&I N.V.

Under the plan, presented by an independent expert appointed by the court, Reficar will receive, among other things, convertible preferred shares representing 19.9% of the share capital of McDermott International Ltd., holding company of a group of entities with presence in more than 54 countries which specialize in engineering services for the energy industry and low-carbon solutions and which includes CB&I N.V.

With this judicial decision, Reficar has been able to assert its rights and those of Colombia.

Ecopetrol is the largest company in Colombia and one of the main integrated energy companies in the American continent  with more than 18,000 employees. In Colombia, it is responsible for more than 60% of the hydrocarbon production of most transportation, logistics, and hydrocarbon refining systems, and it holds leading positions in the petrochemicals and gas distribution segments. With the acquisition of 51.4% of ISA's shares, the company participates in energy transmission, the management of real-time systems (XM), and the Barranquilla - Cartagena coastal highway concession. At the international level, Ecopetrol has a stake in strategic basins in the American continent, with Drilling and Exploration operations in the United States (Permian basin and the Gulf of Mexico), Brazil, and Mexico, and, through ISA and its subsidiaries, Ecopetrol holds leading positions in the power transmission business in Brazil, Chile, Peru, and Bolivia, road concessions in Chile, and the telecommunications sector.

This press release contains forward-looking statements which are based on current expectations and assumptions about future events and which can be identified by the use of forward-looking terminology such as "may", "will", "should", "expect", "anticipate", "estimate", "intend", "continue", or "believe" or other words of similar import, and which forward-looking statements also include certain projections, forecasts, budgets and other estimates. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Many of these risks and uncertainties relate to factors that are beyond the Ecopetrol's control. Ecopetrol does not undertake any obligation to provide any additional information or to update this press release or to correct any inaccuracies that may become apparent, whether as a result of new information, future events or otherwise. You should not place undue reliance on forward-looking statements, which speak only as of the date of this press release.

For more information, please contact:

Head of Capital Markets
Carolina Tovar Aragón
Email: investors@ecopetrol.com.co 

Head of Corporate Communications (Colombia) 
Marcela Ulloa
Email: marcela.ulloa@ecopetrol.com.co

View original content:https://www.prnewswire.com/news-releases/ecopetrol-sa-informs-about-the-decision-adopted-by-the-dutch-court-on-the-restructuring-process-of-cbi-nv-a-subsidiary-of-mcdermott-international-ltd-302096710.html

SOURCE Ecopetrol S.A.

FAQ

What is the latest financial restructuring plan approved by the District Court of Amsterdam involving Ecopetrol?

The latest financial restructuring plan approved by the District Court of Amsterdam involves convertible preferred shares from McDermott International for Refinería de Cartagena S.A.S.

How does Ecopetrol assert its rights and those of Colombia in the recent decision?

Ecopetrol asserts its rights and those of Colombia through the approval of the alternative financial restructuring plan for Refinería de Cartagena S.A.S. by the District Court of Amsterdam.

What percentage of the share capital of McDermott International will Refinería de Cartagena S.A.S. receive under the plan?

Refinería de Cartagena S.A.S. will receive convertible preferred shares representing 19.9% of the share capital of McDermott International under the approved plan.

What are some key areas of operation for Ecopetrol in Colombia and internationally?

Ecopetrol is involved in hydrocarbon production, transportation, logistics, refining, petrochemicals, gas distribution, energy transmission, real-time systems management, road concessions, and telecommunications in Colombia and internationally.