October 9, 2017 / 1:52 PM / 2 months ago

Borr Drilling rig deal could pave way for Mexico contracts -Danske Bank

OSLO, Oct 9 (Reuters) -

** Borr Drilling’s acquisition of nine jack-up rigs from Singapore’s PPL shipyard could provide it a competitive edge in seeking contracts off Mexico, Danske Bank analysts said

** The company has successfully raised $650 million to partly finance the $1.3 billion deal with Sembcorp Marine Ltd , a unit of PPL Shipyard Pte, by issuing 162.5 million new shares via private placement, the company said on Monday.

** The agreed average price of around $140 million per rig represented 67 percent of the original yard turnkey contracts of $209 million, Danske Bank analysts said in a note

** While the price was higher compared to what the company paid for jack-up rigs acquired earlier this year from Transocean , the acquisition still made Borr highly cost competitive, helping to enter a growing Mexico market, Danske added

** “Obviously, we now have a large fleet and are looking at all the major shallow water basins, including Mexico, but it doesn’t signals anything (specific),” the company’s Chief Financial Officer Rune Magnus Lundetrae told Reuters

** He added the company will consider acquiring more rigs, “if the price is good”, but had no immediate plans to do so. (Reporting by Nerijus Adomaitis and Henrik Stolen, editing by Terje Solsvik and Gwladys Fouche)

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