Seadrill axes $1bn bond issue

Bond broken: John Fredriksen-led Seadrill cancels intended bond issue

John Fredriksen-led rig giant pulls plug on convertible bond deal after share price takes a tumble

Seadrill has quashed a planned $1 billion bond issue after its shares nosedived on the day it was set to go ahead.

The Norwegian rig giant said, however, that it remains in a strong cash position, and that the issue was an “opportunity” rather than a “requirement”.

Seadill was intending on the issuance of convertible bonds due in 2019, but its share price moved in the wrong direction in the lead-up to the issue.

“Although the order book was covered, the adverse price movement led to an unattractive conversion price for the issue,” it said on Wednesday.

“Consequently, Seadrill will refuse to accept any acceptance forms delivered in connection with the voluntary incentive payment offer to convert the existing 3.375% $650 million Seadrill convertible bonds due in 2017.”

Seadrill will still have a cash balance of approximately $1.5 billion “following numerous successful transactions”, however.

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