McDermott (NYSE:MDR)
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McDermott International, Inc. (NYSE:MDR) ("McDermott" or
"Company") announced today that on January 17, 2006, the Honorable
Judge Sarah S. Vance of the United States District Court for the
Eastern District of Louisiana issued an order confirming The Babcock &
Wilcox Company ("B&W") Chapter 11 Joint Plan of Reorganization (the
"Plan") and the associated proposed settlement agreement. There were
no appeals from or objections to the Bankruptcy Court's order
recommending confirmation of the Plan and approval of the settlement
agreement. After the required 30-day appeal period from the District
Court order, McDermott anticipates that the B&W Plan and all ancillary
agreements will become effective and fully consummated.
"This is an important day for McDermott, our shareholders, B&W's
customers and the asbestos-related claimants," said Bruce W.
Wilkinson, Chairman and Chief Executive Officer of McDermott. "After
close to 6 years in the courts, it appears that the resolution of
B&W's bankruptcy is imminent. There is still work to be accomplished
in this process, but I am looking forward to soon having the B&W
business back for shareholders as part of McDermott's reported
financial results. Once the settlement is complete, McDermott will
again be a worldwide energy services company with focus on coal,
nuclear and oil & gas projects."
B&W, a wholly owned subsidiary of McDermott, filed for Chapter 11
bankruptcy in New Orleans, Louisiana, on February 22, 2000 as a result
of asbestos-related claims. Since filing for Chapter 11 protection,
B&W has been deconsolidated from McDermott's reported financial
statements. During the 2002 fiscal year, McDermott wrote-off its
remaining investment in B&W. On August 29, 2005, B&W, McDermott, the
Asbestos Claimants Committee and the Future Asbestos-Related
Claimants' Representative reached an agreement in principle on the
terms of the currently proposed Plan and associated settlement. Once
the Plan becomes effective, B&W will be reconsolidated in McDermott's
financial statements. Remaining items required for the Plan to become
effective include receiving McDermott's shareholder approval,
obtaining exit financing for B&W and the completion of certain other
conditions by February 22, 2006, the effective date deadline under the
Plan.
In accordance with the Safe Harbor provisions of the Private
Securities Litigation Reform Act of 1995, McDermott cautions that
statements in this press release which are forward-looking and provide
other than historical information involve risks and uncertainties that
may impact McDermott's actual results of operations. The
forward-looking statements in this press release include statements
regarding McDermott's expectation and timing of the effectiveness of
the Plan and reconsolidation of B&W and the Company's position and
focus thereafter. Although McDermott's management believes that the
expectations reflected in those forward-looking statements are
reasonable, McDermott can give no assurance that those expectations
will prove to have been correct. Those statements are made based on
various underlying assumptions and are subject to numerous
uncertainties and risks including, without limitation, that remaining
conditions to the Plan my not be satisfied within the time required by
the Plan. If one or more of these risks materialize, or if underlying
assumptions prove incorrect, actual results may vary materially from
those expected. For a more complete discussion of these risk factors,
please see McDermott's annual report for the year ended December 31,
2004 and its 2005 quarterly reports filed with the Securities and
Exchange Commission.
McDermott International, Inc. is a leading worldwide energy
services company. The Company's subsidiaries provide engineering,
fabrication, installation, procurement, research, manufacturing,
environmental systems, project management and facility management
services to a variety of customers in the energy and power industries,
including the U.S. Department of Energy. Additional information on
McDermott can be obtained at www.mcdermott.com.