Monday, October 23, 2017

Borr Drilling Deal Could Lead to Mexico Contracts

Posted by October 9, 2017

Borr Drilling's acquisition of nine jack-up rigs from Singapore's PPL (PPL) shipyard could provide it a competitive edge in seeking contracts off Mexico, Danske Bank analysts said.
 
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  • The company has successfully raised $650 million to partly finance the $1.3 billion deal with Sembcorp Marine Ltd , a unit of PPL Shipyard Pte, by issuing 162.5 million new shares via private placement, the company said on Monday.
  • The agreed average price of around $140 million per rig represented 67 percent of the original yard turnkey contracts of $209 million, Danske Bank analysts said in a note
  • While the price was higher compared to what the company paid for jack-up rigs acquired earlier this year from Transocean (RIG) , the acquisition still made Borr highly cost competitive, helping to enter a growing Mexico market, Danske added
  • "Obviously, we now have a large fleet and are looking at all the major shallow water basins, including Mexico, but it doesn't signals anything (specific)," the company's Chief Financial Officer Rune Magnus Lundetrae told Reuters
  • He added the company will consider acquiring more rigs, "if the price is good", but had no immediate plans to do so.
 
Reporting by Nerijus Adomaitis and Henrik Stolen

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