Nine Energy Service Files for Chapter 11, Plans to Cancel Existing Common Stock
Summary
Nine Energy Service has filed for Chapter 11 bankruptcy with a prepackaged plan that will cancel all existing common stock, resulting in a total loss for current shareholders, while providing new equity to secured noteholders and securing new ABL financing.
Key Events
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Voluntary Chapter 11 Filing
Nine Energy Service, Inc. and certain subsidiaries filed voluntary petitions under Chapter 11 of the Bankruptcy Code on February 1, 2026, to implement a prepackaged plan of reorganization.
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Existing Common Stock Cancellation
The plan contemplates the cancellation of all existing common stock for no consideration, resulting in a complete loss for current shareholders.
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Debt-for-Equity Swap for Secured Notes
Holders of Senior Secured Notes Claims will receive 100% of the new common equity interests in the reorganized company, subject to dilution from a management incentive plan.
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New Financing Secured
The company has secured a $125 million debtor-in-possession (DIP) asset-based loan (ABL) facility, which will convert into a $135 million exit ABL facility upon emergence, providing essential liquidity.
Analysis
Nine Energy Service, Inc. and certain subsidiaries have filed for voluntary Chapter 11 bankruptcy to implement a prepackaged plan of reorganization. This comprehensive restructuring will result in the cancellation of all existing common stock for no consideration, leading to a complete loss for current shareholders. The plan is supported by over 70% of Senior Secured Noteholders and 100% of Prepetition ABL Lenders, aiming for a swift emergence within 45 days. The company has secured a $125 million debtor-in-possession (DIP) financing facility, which will convert into a $135 million exit asset-based loan (ABL) facility upon emergence, providing crucial liquidity. General unsecured claims are expected to be unimpaired. This filing marks a fundamental shift in the company's capital structure, prioritizing debt holders over existing equity.
At the time of this filing, NINE was trading at $0.26 on NYSE in the Energy & Transportation sector, with a market capitalization of approximately $25.4M. The 52-week trading range was $0.29 to $1.55. This filing was assessed with negative market sentiment and an importance score of 10 out of 10.