SDLP - Seadrill Partners agrees to acquire an additional 28% interest in Seadrill Operating LP
London, United Kingdom, July 17, 2014 - Seadrill Partners LLC (NYSE: SDLP) (the "Company") announced today that it has entered into an agreement with Seadrill Limited ("Seadrill") pursuant to which it will acquire an additional 28% interest in Seadrill Operating LP for approximately $373 million. After completion of the acquisition, the Company will own a 58% interest in Seadrill Operating which is now in line with the ownership level of the Company's other ultra-deepwater operating company which is 51% owned. The objective of the transaction is to increase exposure to assets that are well known to the Company and that have stable cash flows. The transaction is expected to be cash flow and net asset value accretive and therefore to lead to increased distributions.
The acquisition of additional interests is expected to close before the end of July 2014 and will be financed by funds from recent common unit offerings and surplus funds from the Company's recent term loan B financing.
Seadrill Operating has an ownership interest in three ultra-deepwater drilling rigs, West Aquarius, West Leo and West Cappella and one semi tender rig, West Vencedor.
The Board of Directors of the Company (the "Board") and the Conflicts Committee of the Board (the "Conflicts Committee") have approved the terms and conditions of the acquisition of the additional 28% interest in Seadrill Operating. The Conflicts Committee retained a financial advisor to assist with its evaluation of the transaction. The acquisition is expected to be accretive and is consistent with the Company's growth and diversification strategy. The Board believes that the long-term fundamental outlook for the offshore drilling industry remains strong, and is positive about the Company's future growth prospects.
FORWARD LOOKING STATEMENTS
This news release includes forward looking statements. Such statements are generally not historical in nature, and specifically include statements about the Company's plans, strategies, business prospects, changes and trends in its business and the markets in which it operates. In particular, statements regarding the Company's ability to complete the acquisition, its financing of the acquisition and potential increases in distributions are considered forward looking statements. These statements are made based upon management's current plans, expectations, assumptions and beliefs concerning future events impacting the Company and therefore involve a number of risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, which speak only as of the date of this news release. Important factors that could cause actual results to differ materially from those in the forward looking statements include, but are not limited to, the performance of the drilling rigs in the Company's fleet, delay in payment or disputes with customers, fluctuations in the international price of oil, changes in governmental regulations that affect the Company or the operations of the Company's fleet, increased competition in the offshore drilling industry, and general economic, political and business conditions globally. Consequently, no forward looking statement can be guaranteed. When considering these forward looking statements, you should keep in mind the risks described from time to time in the Company's filings with the SEC, including its Annual Report on Form 20-F (File No. 001-35704). The Company undertakes no obligation to update any forward looking statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for the Company to predict all of these factors. Further, the Company cannot assess the impact of each such factor on its business or the extent to which any factor, or combination of factors, may cause actual results to be materially different from those contained in any forward looking statement.
July 17, 2014
Questions should be directed to:
Graham Robjohns: Chief Executive Officer
Rune Magnus Lundetræ: Chief Financial Officer