Update: Vantage Drilling Company Announces Agreement to Purchase Mandarin Drilling Corporation
July 07 2010 - 1:27PM
Marketwired
Vantage Drilling Company ("Vantage, or the "Company") (NYSE Amex:
VTG.U) (NYSE Amex: VTG) (NYSE Amex: VTG.WS) today announced that it
has signed a definitive agreement to acquire the remaining 55%
ownership interest in Mandarin Drilling Corporation, a Marshall
Islands corporation ("Mandarin"), from F3 Capital, an exempted
company incorporated under the laws of the Cayman Islands for a
purchase price of approximately $139.65 million. Upon closing of
this transaction the Company will be responsible for funding the
remaining construction-related payments for the Platinum Explorer.
The closing of the acquisition is subject to a financing condition
and customary closing conditions. Vantage has currently invested
approximately $123 million for its initial 45% ownership stake in
Mandarin in November 2008. F3 Capital is wholly-owned by Hsin-Chi
Su one of the Company's directors and a significant shareholder of
the Company. Mandarin's sole asset is the construction contract for
the Platinum Explorer, an ultra-deepwater drillship under
construction at Daewoo Shipbuilding & Marine Engineering Co.,
Ltd. ("DSME") in Okpo, Korea. Upon completion of the acquisition,
the Company will be required to make further construction payments
and related equipment and oversight payments aggregating
approximately $650 million (which includes approximately $70
million for construction payments that will be made to DSME from
the acquisition purchase price of $139.65 million noted above) to
complete the purchase and outfitting of the Platinum Explorer.
Paul A. Bragg, the Company's Chairman and CEO, commented,
"We are excited to acquire full ownership of
the Platinum Explorer as we continue to build one of the most
modern and technologically advanced offshore drilling rig fleets in
the world.
"As we have managed the project since inception in August 2007,
we have the highest confidence in the quality of the asset we are
buying. The Platinum Explorer is currently over 95% complete and is
expected to be delivered in November 2010, on time and on
budget."
Upon completion of construction, the Platinum Explorer is
expected to be deployed to offshore India, pursuant to a five year
fixed rate contract with Oil and Natural Gas Company (ONGC) at a
rate of $585,000 per day. Mr. Bragg continued, "Beginning in 2011,
we expect the Platinum Explorer to generate $145 to $150 million of
EBITDA per year or approximately $750 million over the life of this
contract. When combined with our four ultra-premium jackups
currently operating, we expect that the Company will have an EBITDA
run rate between $250 and $270 million per year."
Mr. Su commented, "I am pleased that Vantage is acquiring full
ownership of Platinum Explorer. This is an important further step
in the Company being a differentiated and premier offshore drilling
contractor, which is our shared objective. F3, through the TMT
offshore team, have incorporated many of our innovations, along
with DSME, in the Platinum Explorer that make the unit best in
class from a safety and efficiency perspective, for ultra-deepwater
drilling. Vantage has done an excellent job ensuring construction
of the unit on time and on budget, and as a major shareholder of
Vantage, I believe the transaction will help drive further
shareholder value as Vantage continues to grow."
The Platinum Explorer is equipped for drilling in water depths
of up to 10,000 feet, with a total vertical drilling depth capacity
of up to 40,000 feet. The Platinum Explorer's hull design has a
variable deck load of approximately 20,000 tons and measures 781
feet long by 137 feet wide.
For more information on the transaction, please see the
presentation on the Mandarin acquisition that is included under the
Investor Relations tab on the Company's website at
www.vantagedrilling.com.
About the Company
Vantage is an international offshore drilling company focused on
operating a fleet of high specification drilling units. Vantage's
principal business is to contract drilling units, related equipment
and work crews primarily on a dayrate basis to drill oil and
natural gas wells for our customers. Vantage also provides
construction supervision services for, and will operate and manage,
drilling units owned by others. Through its fleet of eight owned
and managed drilling units, Vantage is a provider of offshore
contract drilling services globally to major, national and large
independent oil and natural gas companies.
Forward-Looking Statements
This press release contains "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995
concerning future events, including, but not limited to, the
completion of the acquisition of Mandarin, the Company's growth
strategy and measures to implement such strategy. These
forward-looking statements are based on current expectations,
estimates and projections about the Company, the Company's
industry, management's beliefs and certain assumptions made by
management. Whenever possible, the Company has identified these
"forward-looking statements" by words such as "expects,"
"believes," "anticipates" and similar phrases. Readers are
cautioned that any such forward-looking statements are not
guarantees of future performance and are subject to certain risks,
uncertainties and assumptions that are difficult to predict.
Because such statements involve risks and uncertainties, the actual
results and performance may differ materially from the results
expressed or implied by such forward-looking statements. Factors
that could cause actual results to differ materially include
competitive factors in the markets in which the Company operates,
risks associated with operating internationally in the marine
construction industry and other factors listed in the Company's
filings with the Securities and Exchange Commission. Given these
uncertainties, readers are cautioned not to place undue reliance on
such forward-looking statements. Unless otherwise required by law,
the Company disclaims any obligation to update its view of any such
risks or uncertainties or to announce publicly the result of any
revisions to the forward-looking statements made here.
Public & Investor Relations Contact: Paul A. Bragg Chairman
& Chief Executive Officer Vantage Drilling Company (281)
404-4700
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