By Paul A. Harris
Portland, Ore., July 13 – Seadrill Ltd. priced an upsized $500 million issue of Seadrill Finance Ltd. seven-year senior secured second-lien notes (B2/BB/B+) at par to yield 8 3/8% on Thursday, according to market sources.
The issue size increased from $450 million.
The yield printed at the tight end of yield talk in the 8½% area. Initial guidance was in the 8¾% area.
The deal was heard to be playing to $2.7 billion of demand on Thursday morning, at which time 10 accounts were expected to take down 50% of the issue, sellside sources said.
JPMorgan, Citigroup, Deutsche Bank and DNB were the joint bookrunners.
The Hamilton, Bermuda-listed offshore drilling contractor plans to use the proceeds, including the incremental proceeds resulting from the $50 million upsize of the deal, to prepay secured debt facilities in full, with the remainder to be used for general corporate purposes
In connection with the notes issue, Seadrill Finance entered a five-year senior secured revolving credit facility governed by a new credit agreement. It provides for commitments permitting borrowings of up to $225 million with an accordion feature of up to $100 million. The maturity may be reduced to four years subject to certain financial tests.
| Issuer: | Seadrill Finance Ltd.
|
| Amount: | $500 million, increased from $450 million
|
| Issue: | Senior secured second-lien notes
|
| Maturity: | Aug. 1, 2030
|
| Bookrunners: | JPMorgan, Citigroup, Deutsche Bank and DNB
|
| Co-managers: | Barclays and BTIG
|
| Coupon: | 8 3/8%
|
| Price: | Par
|
| Yield: | 8 3/8%
|
| First call: | Aug. 1, 2026 at 104.186
|
| Trade date: | July 13
|
| Settlement date: | July 27
|
| Ratings: | Moody’s: B2
|
| S&P: BB
|
| Fitch: B+
|
| Distribution: | Rule 144A and Regulation S
|
| Price talk: | 8½% area
|
| Marketing: | Roadshow
|
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