Drilling stock turned around – decreased after the new capital increase

Drilling stock turned around - decreased after the new capital increase

Ahead of the exchange’s opening on Tuesday, Tor Olav Tøim’s Bor Drilling announced that the capital increase announced yesterday has been completed, and the company has raised $30 million, roughly 264 million kroner, in new capital.

The capital increase was implemented at a subscription price of NOK 19.97, somewhat higher than the closing price on Monday, which was NOK 19.46 per share. According to a letter from the company, the issue has been significantly oversubscribed.

When the stock exchange opened on Tuesday, Borr Drilling’s stock was up over eight percent, but after the trading day, the rally was completely reversed. At the close of trading, the stock was down more than 2.3 percent.

Troim has subscribed to 26 mills.

Tor Olav Trøim, founder of Borr Drilling, received 1,333 million shares in the issue, which is equivalent to an IPO of NOK 26 million.

After the issuance, Troim and its associated companies will own just over 10.1 million shares in the company. This corresponds to a roughly seven percent ownership stake, according to DN’s calculations.

Trøim started Borr Drilling in 2016, and the recipe was to buy rigs on the cheap after the market crash, as a result of the sharp and persistent drop in oil prices. But despite a promising start, the bets have soured as the recovery awaits, and it only got worse after the Corona pandemic hit the market in 2020.

Bohr and Trom several times engaged creditors and investors in solutions that led to huge debt delays.

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On Tuesday, it also became known that hedge fund Granular Capital Ltd bought more in Bor. The hedge fund is managed by former Dynamo Capital partner Thiago Mordehachvili.

After the acquisition, Granular Capital owns approximately 27.5 million Bor shares, which equates to an ownership interest of 20.04 percent. Prior to purchase, the ownership stake was 19.99 percent.

Deferred debt 12 billion dollars.

Along with the news that Borr Drilling will carry out a share issue, the company said in a statement on Monday that it had reached an agreement with its largest creditor on deferring a total of $1.4 billion towards debt maturity, or 12.4 billion kroner. .

The agreement covers Borr’s obligations to its shipyards in Singapore, PPL and Keppel, which have now been deferred from 2023 to 2025.

Borr Drilling highly appreciates the support it has received from its most important creditors. It’s a testament to the confidence in Borr Drilling, and to the market recovery we’re seeing now, Borr CEO Patrick Schorn says in the stock exchange announcement.

In the agreement, Burr committed, among other things, to paying more than $50 million in accrued costs and interest in 2022, of which $22.4 million was already in January. The funds raised in this release are intended to cover this transfer.

Another important condition of the new agreement is that Borr must also reach an agreement with its other creditors, including bondholders, on deferring the remainder of the company’s debt by June next year.

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At the end of September, Bor had a total of $2.2 billion in debt and other liabilities, most of which was due in 2023.(Conditions)Copyright Dagens Næringsliv AS and/or our suppliers. We would like you to share our cases using a link that leads directly to our pages. All or part of the Content may not be copied or otherwise used with written permission or as permitted by law. For additional terms look here.

Dalila Awolowo

Dalila Awolowo

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