Nine Energy Service Exits Chapter 11, Cuts $320 Million in Debt

Nine Energy Service wiped out roughly $320 million in secured debt and cancelled all existing common stock as it emerged from a prepackaged Chapter 11 bankruptcy, completing one of the energy sector's faster recent restructurings in just over a month.

The U.S. Bankruptcy Court for the Southern District of Texas confirmed Nine's plan of reorganization on March 4, with Judge Christopher M. Lopez presiding over the case. The Houston-based onshore completions provider filed voluntarily on Feb. 1, 2026, under lead case number 26-90295, entering the process with approximately $388 million in total funded debt.

The restructuring eliminated approximately $320 million in 13% senior secured notes due 2028 through an equitization of those claims, converting creditors' debt into new equity. The company said the transaction also reduced annual cash interest expense by roughly $40 million, a meaningful reprieve for a business whose heavy debt load traced largely to its 2018 acquisition of Magnum Oil Tools.

Upon emergence, Nine secured a $135 million exit asset-based lending facility from its existing ABL lenders, replacing a $125 million debtor-in-possession facility that had served as a full roll-up of the prepetition ABL during the bankruptcy proceedings. The new exit facility gives the company liquidity headroom as it returns to normal operations serving unconventional oil and gas wells across major U.S. and Canadian shale basins, including the Marcellus and Utica formations.

"Today marks the beginning of a new chapter for Nine as we move forward financially stronger, better positioned for future growth," said Ann Fox, president and chief executive officer.

The speed of the process underscores the strategic value of prepackaged bankruptcies: Nine entered court with a restructuring support agreement already signed by holders of the senior secured notes and the ABL lender group, allowing the case to run from filing to confirmation in 32 days.

The cost to existing equity holders was total. All outstanding common shares were cancelled for no consideration as part of the confirmed plan, effective March 4. SEC filings show Fox herself disposed of 373,795 common shares at $0.00 per share in a disposition to the issuer, leaving her with zero direct holdings of Nine Energy common stock after the transaction.

Nine employs approximately 1,100 full-time workers and around 30 contractors across its completions services footprint, offering perforating and completion tools, cementing, coiled tubing, and wireline services. The company said it remains focused on delivering its full suite of completions solutions and that the restructuring provides "greater optionality and flexibility to support the Company's long-term financial health."

The balance sheet transformation is dramatic on paper: entering bankruptcy with $388 million in funded debt and exiting with a $135 million ABL as the primary obligation. Whether Nine can translate that relief into sustainable profitability will depend on activity levels across North American shale basins, where operators have been managing capital discipline against a backdrop of volatile crude prices.

The Magnum Oil Tools acquisition that saddled Nine with its debt burden was a bet on oilfield services consolidation during a cyclically weak period. Paying down that strategic miscalculation took nearly eight years and cost every common shareholder everything they held.