Valaris Limited and its wholly-owned subsidiary, Valaris Finance Company LLC, announced the pricing of their private placement (the “Offering”) under Rule 144A and Regulation S of the Securities Act of 1933, as amended (the “Securities Act”), of $700 million in aggregate principal amount of 8.375% Senior Secured Second Lien Notes due 2030 (the “Second Lien Notes”). The Offering was upsized to $700 million in aggregate principal amount of Second Lien Notes from the original offering size of $600 million in aggregate principal amount of Second Lien Notes. The Second Lien Notes mature on April 30, 2030 and will be issued at par. The Offering is expected to close on April 19, 2023, subject to customary closing conditions.
Valaris intends to use the net proceeds from the Offering to fund the previously announced redemption of all of its outstanding Senior Secured First Lien Notes due 2028 (the “First Lien Notes”), subject to the completion of the Offering, and for general corporate purposes.
The securities to be offered and sold have not been registered under the Securities Act, or any state securities laws, and unless so registered, the securities may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. Valaris plans to offer and sell the securities only to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act and to persons outside the United States pursuant to Regulation S under the Securities Act.
As previously announced, on April 3, 2023, Valaris entered into a senior secured five-year credit agreement (the “Credit Agreement”), which provides for commitments permitting borrowings of up to $375 million. The Credit Agreement will be (i) guaranteed by the same subsidiaries that guarantee the Second Lien Notes and by Valaris Finance Company LLC and (ii) secured on a first lien basis by the same assets that secure the Second Lien Notes. The commitments under the Credit Agreement will become available to be borrowed upon the satisfaction of various conditions, including the consummation of the Offering and the redemption or discharge of all of the First Lien Notes. The Offering is cross-conditioned upon the occurrence of such availability substantially concurrently with the closing.
