SDLP - Seadrill Partners LLC agrees to acquire the semi-submersible rigs West Leo and West Sirius
(Thomson Reuters ONE) -
London, United Kingdom, December 02, 2013 - Seadrill Partners LLC (NYSE: SDLP)
(the "Company") announced today that it has entered into an agreement with
Seadrill Limited ("Seadrill") pursuant to which (i) Seadrill Operating LP, the
Company's 30% owned subsidiary ("Seadrill Operating"), will acquire all of the
ownership interests in the entities that own and operate the semi-submersible
drilling rig, the West Leo (the "Leo Acquisition"), and (ii) Seadrill Capricorn
Holdings LLC, the Company's 51% owned subsidiary ("Capricorn Holdings"), will
acquire all of the ownership interests in the entities that own and operate the
semi-submersible drilling rig, the West Sirius (the "Sirius Acquisition") from
Seadrill. The Leo Acquisition and the Sirius Acquisition (collectively, the
"Acquisitions") will be accomplished through a series of purchases,
contributions and assumptions of debt. The Acquisitions are subject to the
satisfaction of certain closing conditions.
The West Leo
The West Leo is a 6th generation, dynamically positioned semi-submersible
drilling rig that was delivered to its current customer, Tullow Oil Ghana Ltd.,
in 2012 and commenced operations off the coast of West Africa in May 2012. The
West Leo is expected to carry out operations in West Africa until the end of its
current contract in May 2018 at a dayrate of $605,000 for operations in Ghana.
The West Sirius
The West Sirius is a 6th generation, dynamically positioned semi-submersible
drilling rig that was built and delivered in 2008. The West Sirius currently
operates in the U.S. Gulf of Mexico under a drilling contract with BP which
expires in July 2014. Upon expiration of the current contract, the West Sirius
will operate under a new contract with BP that will expire in July 2019 at a
dayrate of $535,000.
Financing of the Acquisitions
The implied purchase price of the Leo Acquisition is $1.250 billion, including
working capital. The Company's portion of the purchase price for the Leo
Acquisition will be $229.4 million. In addition, a subsidiary of Seadrill
Operating intends to enter into a $485.5 million intercompany loan agreement
with Seadrill (the "Leo Loan Agreement"), which will require it to make payments
of principal and interest under the credit facility that Seadrill used, in part,
to construct the West Leo.
The implied purchase price of the Sirius Acquisition is $1.035 billion,
including working capital. The Company's portion of the purchase price for the
Sirius Acquisition will be $298.4 million. The Company intends to fund
$70.0 million of the purchase price by issuing a zero coupon discount note to
Seadrill that matures in June 2015. Upon maturity of such note, the Company will
repay $72.6 million to Seadrill. In addition, a subsidiary of Capricorn Holdings
intends to enter into a $220.1 million intercompany loan agreement with
Seadrill, which will require it to make payments of principal and interest under
the credit facility used to finance the West Sirius. In addition, Capricorn
Holdings intends to finance $229.9 million of the purchase price by issuing a
zero coupon discount note to Seadrill that matures in June 2015. Upon maturity
of such note, Capricorn Holdings will repay $238.5 million to Seadrill.
The Company intends to satisfy the cash portion of its purchase price of the
Acquisitions with the proceeds of equity issuances and borrowings from Seadrill.
Board Approval
The Board of Directors of the Company (the "Board") and the Conflicts Committee
of the Board (the "Conflicts Committee") have approved the terms and conditions
of the Acquisitions and the concurrent private placement. The Conflicts
Committee retained a financial advisor, Global Hunter Securities, to assist with
its evaluation of the Acquisitions.
As a result of the Acquisitions, the Company's management has recommended to the
Board an increase in the Company's quarterly cash distribution of between $0.055
and $0.0675 per common unit (or an annualized increase of between $0.22 and
$0.27 per common unit), which would become effective for the Company's
distributions with respect to the quarter ending March 31, 2014. Assuming
management's recommendation is approved, the Company's distribution will have
increased by a minimum of 29% since its initial public offering. Any such
increase would be conditioned upon, among other things, the closing of the
Acquisitions, the approval of such increase by the Board and the absence of any
material adverse developments or potentially attractive opportunities that would
make such an increase inadvisable.
The Board is pleased that the Company has entered into this contribution
agreement with respect to its third and fourth acquisitions since the Company's
initial public offering in October 2012. These acquisitions will significantly
increase the Company's asset diversification and should therefore reduce
earnings volatility. As with the Company's acquisitions of the T-15 and T-16,
this acquisition is expected to be an accretive transaction and is consistent
with the Company's growth strategy. The Board believes that the fundamental
outlook for the offshore drilling industry remains strong, and is positive
about the Company's future growth prospects.
FORWARD LOOKING STATEMENTS
This news release includes forward looking statements. Such statements are
generally not historical in nature, and specifically include statements about
the Company's plans, strategies, business prospects, changes and trends in its
business and the markets in which it operates. In particular, statements
regarding the Company's ability to complete the Acquisitions, its financing of
the Acquisitions and projected increases in cash distributions are considered
forward looking statements. These statements are made based upon management's
current plans, expectations, assumptions and beliefs concerning future events
impacting the Company and therefore involve a number of risks, uncertainties and
assumptions that could cause actual results to differ materially from those
expressed or implied in the forward-looking statements, which speak only as of
the date of this news release. Important factors that could cause actual results
to differ materially from those in the forward looking statements include, but
are not limited to, the performance of the drilling rigs in the Company's fleet,
delay in payment or disputes with customers, fluctuations in the international
price of oil, changes in governmental regulations that affect the Company or the
operations of the Company's fleet, increased competition in the offshore
drilling industry, and general economic, political and business conditions
globally. Consequently, no forward looking statement can be guaranteed. When
considering these forward looking statements, you should keep in mind the risks
described from time to time in the Company's filings with the SEC, including its
Annual Report on Form 20-F (File No. 001-35704). The Company undertakes no
obligation to update any forward looking statements to reflect events or
circumstances after the date on which such statement is made or to reflect the
occurrence of unanticipated events. New factors emerge from time to time, and it
is not possible for the Company to predict all of these factors. Further, the
Company cannot assess the impact of each such factor on its business or the
extent to which any factor, or combination of factors, may cause actual results
to be materially different from those contained in any forward looking
statement.
December 2, 2013
Questions should be directed to:
Graham Robjohns: Chief Executive Officer
Rune Magnus Lundetræ: Chief Financial Officer
This announcement is distributed by GlobeNewswire on behalf of
GlobeNewswire clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Seadrill Partners LLC via GlobeNewswire
[HUG#1747223]
Datum: 02.12.2013 - 22:14 Uhr
Sprache: Deutsch
News-ID 321948
Anzahl Zeichen: 9010
contact information:
Town:
London
Kategorie:
Business News
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