EMGS: Going Concern & Capital Structure

Core Viewpoint - Electromagnetic Geoservices ASA (EMGS) is facing a need for additional funding to sustain operations and is exploring various restructuring options to preserve stakeholder value [1][2]. Financial Situation - The company has outstanding interest-bearing debt of USD 19.5 million under the convertible bond issue EMGS03, and the current capital structure is deemed unsustainable based on activity levels and outlook [2]. - The company is evaluating the potential conversion of the EMGS03 convertible bonds into new equity, which could lead to significant dilution for existing shareholders if executed at or below the current market price [3]. Strategic Alternatives - EMGS is assessing all available strategic and financial alternatives, including the possibility of a full conversion of the EMGS03 bonds, although there is no guarantee of obtaining the necessary consent from bondholders for such a resolution [4]. - Even if a conversion is successfully completed, it may not be sufficient to establish a financially sustainable long-term solution for the company [4]. Company Overview - EMGS is a leader in the marine electromagnetic (EM) market, utilizing proprietary technology to assist oil and gas companies in offshore hydrocarbon exploration [7]. - The company's services enhance exploration efficiency and reduce finding costs per barrel by integrating EM data with seismic and geological information [7].