Idan Ofer-backed Pacific Drilling has signed a $50m revolving credit facility that sees the lenders shoot to the top of the capital stack.
The New York-listed owner of seven drillships said the deal was hashed out with Angelo, Gordon Energy Servicer as administrative agent, with the funds providing working capital and helping with capital expenditure needs.
"We are pleased to partner with Angelo Gordon for this three-year $50m facility," said chief executive Bernie Wolford.
"As we continue to see the market for high-specification drillships improve, this facility allows us the financial flexibility to take advantage of new opportunities."
The agreement is guaranteed by all of the subsidiaries that guaranty Pacific Drilling's 8.375% First Lien Notes due 2023 and 11.0/12.0% Second Lien PIK notes due 2024.
It is secured by a sole first-priority lien on its and the guarantors' accounts receivable and a shared first-priority lien on all assets serving as collateral, with a superpriority right to repayment ahead of other first lien holders in an enforcement action.
The company said the agreement totals just a portion of its permitted indebtedness and still allows the company the ability to take out $50m with respect to a capital lease facility or $50m through general indebtedness.
Pacific Drilling was recently ordered to pay Samsung Heavy Industries a $320m arbitration award, ordered after the South Korean shipyard complained the company's cancellation of a contract in 2013 constituted an "unfair practice".
It said it was exploring an appeal and considering “all available legal remedies” in the dispute and is expected to post a $225m loss for the fourth quarter of 2019.
Pacific Drilling shares were down $0.05, or 3.3%, to $1.59 in early trading.
