Odfjell Offshore: Financing growth in ultra deepwater and harsh environment offshore drilling

Odfjell Offshore, the rig owning subsidiary of international drilling contractor Odfjell Drilling, has initiated an equity private placement to raise USD 400 to 500 million to further develop its current fleet of six state-of-the-art ultra deepwater and harsh environment offshore drilling units. In addition Odfjell Offshore may over-allot up to 10% of additional new Shares.

Odfjell Drilling will remain a majority shareholder of Odfjell Offshore after the private placement and will continue to provide its 40 years of operational experience, as well as its 3,000 highly skilled employees in the Odfjell Drilling organization.

Chairman of the board of Odfjell Offshore Mr. Simen Lieungh states:

“Odfjell Offshore’s strategy is to expand our drilling operations in the ultra deep water and harsh environment market. Our fleet is uniquely positioned and we have a strong backlog.  Currently, we have one newbuild ultra deep water semi under construction. In addition we have secured an option to build two similar units at Daewoo Shipbuilding & Marine Engineering in South Korea.”

Odfjell Offshore has retained DNB Markets, Pareto Securities AS, RS Platou Markets AS and Swedbank First Securities as Joint Lead Managers and Bookrunners and Danske Markets and Nordea Markets as Co-Lead Managers to advise on and effect the private placement of new shares directed towards investors in Norway and other jurisdictions subject to applicable exemptions from registration and other requirements under applicable securities laws.

The offer price per share will be determined through a book-building process within an indicative price range of USD 7.00   USD 8.00 per share. 

The bookbuilding period commences 12 March 2012 at 10:00 CET and will close 23 March 2012 at 17:30 CET. Odfjell Offshore may, however, at any time resolve to shorten or extend the application period at its own discretion.

Odfjell Offshore owns a fleet of highly capable and modern semisubmersible drilling units and UDW drillships currently under contracts in Norway, UK, Brazil, Angola and Tanzania:

- Deepsea Atlantic and Deepsea Stavanger (both 100% owned)
    o Two state-of-the-art ultra deepwater and harsh environment semisubmersible drilling units delivered in 2009 and 2010

- Deepsea Aberdeen (100% owned)
    o Ultra deepwater and harsh environment semisubmersible drilling rig 
    o Ultra deepwater and harsh environment semisubmersible drilling rig currently under construction at Daweoo Shipyard in South Korea with expected delivery in May 2014
    o Options for two similar units with scheduled delivery in December 2014 and March 2015

- Deepsea Metro I and Deepsea Metro II (both 40% owned)
    o Two ultra deepwater drillships delivered in 2011

- Deepsea Bergen (71.5% owned)
    o Enhanced 3rd generation North Sea semisubmersible drilling rig designed and built by Odfjell in 1983 (with subsequent substantial upgrades)


Odfjell Offshore has decided to apply for listing on Oslo Stock Exchange following completion of the private placement and targets listing in end May 2012.

Source: Odfjell Offshore