Borr Drilling Raises $300M via 3.50% Notes, Plans $195M Bond Buyback
Borr Drilling issued $300M of 3.50% convertible senior notes due 2033, convertible at 125 shares per $1,000 principal (approx. $8.00/share), representing a >40% premium, and plans to use proceeds to repurchase $195.2M of its 2028 convertible bonds. Shares have rallied over 200% recently, driven by fleet expansion, debt refinancing and increased jackup tendering.
1. Convertible Note Offering
Borr Drilling completed a $300 million offering of convertible senior notes due May 1, 2033, bearing a 3.50% annual coupon, payable semi-annually from November 1, 2026. The notes are convertible at an initial rate of 125.0000 common shares per $1,000 principal, equivalent to approximately $8.00 per share, representing a conversion premium exceeding 40%.
2. Use of Proceeds and Debt Repurchase
The company will allocate a portion of the net proceeds to repurchase $195.2 million aggregate principal amount of its outstanding 2028 convertible bonds from certain holders, with remaining funds earmarked for general corporate purposes. This targeted debt reduction is expected to streamline Borr’s capital structure and lower interest obligations on legacy debt.
3. Market Sentiment and Upgrade
Shares of Borr Drilling have surged over 200% from recent lows as the firm expanded its modern jack-up fleet and refinanced convertible debt at favorable terms. Rising tendering activity in shallow-water drilling has underpinned a recent buying opportunity thesis, prompting an upgraded rating and positive investor outlook.