Ocean Rig UDW Inc. (ORIG)

[keekee]

For some sellers here you may want to read warnings that have been coming from the entire industry, including this one from Seadrill earlier this year: from Bloomberg---Seadrill Ltd., the offshore driller with the biggest debtload, hired Houlihan Lokey Inc. and Morgan Stanley to advise it in negotiations on restructuring $11 billion of loans and bonds, two people familiar with the matter said.

Bank lenders to the company formed a committee this month to lead the talks and appointed adviser Lazard Ltd. and law firm White & Case, said the people, who asked not to be identified because the information is private.


Offshore drillers are struggling to repay debt as competition and reduced spending by oil companies hurt profits. Falling demand for rig services is forecast to reduce sales at the world’s largest offshore contractors by 25 percent this year and at least 10 percent in 2017, according to Bloomberg Intelligence analyst Andrew Cosgrove.

Spokesmen at Seadrill, Houlihan Lokey, Lazard, Morgan Stanley and White & Case declined to comment on the appointments.

Seadrill has $2.6 billion of unsecured bonds and $8.4 billion of bank facilities. Almost $3.5 billion of debt is due by the end of next year, according to data compiled by Bloomberg. The company’s $948 million of bonds due September 2017 are quoted at about 45 cents on the dollar, the data show.