Vantage Drilling Co. (NYSE: VTG) closed the offer through its wholly owned subsidiary, Offshore Group Investment Ltd., of US $775 million of its 7.125% senior secured first lien notes due 2023, a term loan for US $350 million, and an amended and restated credit agreement for US $200 million.
Offshore Group has also delivered notice to the holders of all of its outstanding 11.5% senior secured first lien notes due 2015 of its intention to redeem any and all of the 2015 notes pursuant to the indenture governing the 2015 notes. The redemption price for the 2015 notes will be 108.625% of the outstanding principal amount of the 2015 notes. The redemption is expected to be completed on April 29.
Net proceeds will be used by Offshore Group to pay the total consideration and accrued and unpaid interest on the 2015 notes, for general corporate purposes, and pay fees and expenses related to the financings.
The notes were issued at par and will be guaranteed by Vantage and each of Offshore Group’s existing and future subsidiaries and by certain of Vantage's other subsidiaries. The notes will be senior secured obligations of Offshore Group Investment and the guarantors. The notes and the related guarantees are secured by all of Offshore Group’s assets including a first priority security interest in the Emerald Driller, Sapphire Driller, Topaz Driller, Aquamarine Driller, Platinum Explorer, Titanium Explorer, and, upon its delivery, the Tungsten Explorer, and by a pledge of the stock of Offshore Group and the guarantors other than Vantage, in each case, subject to certain exceptions and permitted liens.
The notes were not registered under the Securities Act of 1933 and were offered or sold in the US without registration or an applicable exemption.
The term loan was issued at 98.5% of its face value and will bear interest at adjusted LIBOR plus a margin of 4.5% per annum, with a LIBOR floor of 1.25% per annum or the alternative base rate plus a margin of 3.5% per annum. The term loan will amortize in equal quarterly installments in aggregate annual amounts equal to 1% of the original principal amount of the term loan, with the balance payable on the sixth anniversary of the term loan. The term loan is secured by the same collateral securing the notes.
The credit agreement has a maturity date of April 25, 2017, and will bear interest at the adjusted base rate plus a margin of 2.5% per annum or LIBOR plus a margin of 3.50% per annum. Under the credit agreement, the company can draw amounts for advances and letters of credit up to an aggregate principal amount of US $200 million. The credit agreement is secured by the same collateral as the notes and the term loan.
Vantage Drilling Co. is an oil and gas company that through its subsidiaries provides offshore contract drilling services the US and internationally. The company is based in Houston.
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