The offshore drilling company Seadrill announced entered into privately negotiated exchange agreement with certain holders of their outstanding 5-5/8% Senior Notes due in 2017, revealed Finance Apprise. under the agreement Seadrill will issue 8,184,340 new shares of its common stock with value of 2 USD/share in exchange of 55 million USD principal amount of the 5-5/8% Senior Notes due in 2017 in accordance with Section 3(a)(9) of the US Securities Act of 1933, as amended. The settlement is expected to happen in May 20, 2016, which will increase the total amount of Seadrill’s hares to 500,944,280 of its common stock issued and outstanding.
The new bonds-for-shares deal will improve the liquidity of the company and will transform its debt to equity, as well as improve the cash flows. Last month Seadrill adjusted several of its loan agreements with lenders in order to refinance its business and insulate itself from declines in asset values. The offshore drilling company suffered from liquidity and cash flows problems, related with delaying offshore drilling business and low oil prices.
Seadrill is a deepwater drilling contractor, which provides offshore services to the oil and gas industry. It is incorporated in Bermuda and managed from London. Seadrill has operations in Angola, Brunei, the Republic of Congo, Indonesia, Malaysia, Nigeria, Norway, Thailand, Brazil, Saudi Arabia, UAE, USA and UK. The company operates semi-submersibles, jack-ups and drillships.