Nabors Announces Offering of Senior Guaranteed Notes
Nabors Industries (NYSE: NBR) has announced that its subsidiary, Nabors Industries, Inc. (NII), is offering $550 million in senior guaranteed notes due 2031. These notes will be fully guaranteed by Nabors and its subsidiaries that guarantee the existing 7.50% senior notes due 2028. The new notes will rank equally with NII's existing senior obligations.
Nabors plans to use the proceeds, along with cash on hand, to redeem all of its 7.25% senior guaranteed notes due 2026. Any excess funds will be used for general corporate purposes, potentially including repayment of other outstanding debt. The notes will be offered to qualified institutional buyers under Rule 144A and to non-U.S. persons under Regulation S of the Securities Act.
- Offering $550 million in new senior guaranteed notes due 2031
- Redeeming all 7.25% senior guaranteed notes due 2026
- Potential repayment of other outstanding indebtedness
- Increasing long-term debt obligations
- Notes not registered under Securities Act, limiting potential buyers
Nabors Industries Ltd. has announced an offering of
From a financial perspective, the issuance of new notes comes with several implications. Firstly, the company is leveraging its creditworthiness to secure new funding, which reflects confidence in its future cash flows and operational stability. However, it's important to consider the cost of issuing new debt and how it compares to the current market rates. The reduction in interest expenses from refinancing should provide a short-term boost to cash flow, which could be a positive signal for investors.
Additionally, the new notes being offered at a senior unsecured status and guaranteed by Nabors and its subsidiaries add a layer of security for investors, making them more attractive. This could potentially lower the interest rate Nabors would need to offer, benefiting the company financially.
For retail investors, this step towards managing debt more efficiently is a sign of robust financial management. However, it's essential to keep an eye on the overall debt levels and market conditions which could affect the cost of borrowing and refinancing.
The market's reception of Nabors Industries Ltd.'s new offering of senior guaranteed notes will hinge on several factors, including current investor sentiment, prevailing interest rates and the overall health of the oil and gas sector. Nabors, operating predominantly in the oilfield services industry, is subject to the cyclical nature of commodity prices, which can impact its revenue and profitability.
Investors will likely appraise this offering by considering the company's past performance, recent financial reports and forward-looking statements. The move to redeem 7.25% notes due 2026 using the proceeds from the 2031 notes indicates a strategic shift towards reducing interest burden and extending debt maturity, which is generally perceived as a sound financial maneuver. However, investors should also be cautious about the amount of leverage Nabors is taking on. While refinancing can improve short-term liquidity and reduce interest payments, it does not reduce the overall debt load.
In the context of the broader market, the success of this offering could signal investor confidence in Nabors' ability to navigate market volatility and maintain financial stability. For retail investors, the key takeaway is that Nabors is actively managing its debt, which could be seen as a positive move, provided the broader market conditions remain favorable.
The Notes will be senior unsecured obligations of NII and will rank pari passu in right of payment with all of NII's existing and future senior obligations, including Nabors'
Nabors intends to use the net proceeds from this offering, along with cash on hand, to redeem all of its
The Notes will be offered and sold to persons reasonably believed to be qualified institutional buyers in accordance with Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and to persons outside
The Notes will not be offered or sold in any such jurisdiction except pursuant to an exemption from, or in a transaction not subject to, the relevant requirements of laws and regulations of such jurisdictions.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy the Notes or any other securities of Nabors or its subsidiaries, nor shall there be any offer, solicitation or sale of the Notes in any state or jurisdiction in which such offer, solicitation or sale would be unlawful.
The information above includes forward-looking statements within the meaning of the Securities Act and the Securities Exchange Act of 1934, as amended. Such forward-looking statements are subject to certain risks and uncertainties, as disclosed by Nabors from time to time in its filings with the Securities and Exchange Commission. As a result of these factors, Nabors' actual results may differ materially from those indicated or implied by such forward-looking statements. Nabors does not undertake to update these forward-looking statements.
About Nabors Industries
Nabors Industries is a leading provider of advanced technology for the energy industry. With presence in more than 20 countries, Nabors has established a global network of people, technology and equipment to deploy solutions that deliver safe, efficient and responsible energy production. By leveraging its core competencies, particularly in drilling, engineering, automation, data science and manufacturing, Nabors aims to innovate the future of energy and enable the transition to a lower-carbon world. Learn more about Nabors and its energy technology leadership: www.nabors.com.
Media Contacts:
For further information regarding Nabors, please contact William C. Conroy, CFA, Vice President of Corporate Development & Investor Relations, +1 281-775-2423 or via e-mail william.conroy@nabors.com, or Kara Peak, Director of Corporate Development & Investor Relations, +1 281-775-4954 or via email kara.peak@nabors.com. To request investor materials, contact Nabors' corporate headquarters in
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SOURCE Nabors Industries Ltd.
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