Borr Drilling, backed by shipping tycoon Tor Olav Troim, has tapped international bond investors to raise $1.54bn to help repay debt.
The offering included $1bn worth of five-year senior secured bonds with a coupon of 10% and a further $515m worth of seven-year senior secured bonds with a coupon of 10.375%.
The Oslo and New York-listed company has also raised a further $50m from the private placement of 7.5m new shares in Norway.
Borr Drilling said the proceeds from the offering are intended to be used, together with the proceeds from the private placement of shares, to repay all outstanding secured borrowings.
These include the company’s DNB Facility, Hayfin Facility, shipyard delivery financing arrangements with OPPL and PPL, and the company’s $150m principal amount of Norwegian law senior secured bonds.
The company said the notes will be guaranteed by the company and certain of its subsidiaries and secured on a senior basis on substantially all of the company’s assets and certain subsidiary guarantors.
One industry observer calculated that interest on the bonds would be about $150m per year. However, stretching out the maturities and dealing with fewer lenders was described as a good thing.
Borr Drilling operates a fleet of 24 modern jack-up drilling rigs all built between 2011 and 2020 and Singapore’s Keppel FELS or PPL Shipyard.
Borr Drilling appointed 27-year Goldman Sachs veteran Jeffery Currie to its board of directors earlier this month.
Currie recently retired from the US investment bank where he was most recently global head of commodities research.
“After decades of analysing the trends that shape global commodity markets, I am now focused on the themes that are key to energy transition,” Currie said.
“One such theme is developing clean fast cycle production in the Middle East. Borr Drilling, a company I have known for years, can do this at scale with low costs.
“It owns the most modern fleet in the industry and focuses on quick payback and efficient shallow water wells in the world’s most prolific reservoirs in an environmentally responsible manner,” he added.
In addition, the company recently appointed Borr Drilling chief executive Patrick Schorn as a new director.
Schorn became CEO of Borr Drilling in September 2020 after serving as a director of the board since January 2018.