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ENERGY & OFFSHORE | Staff Reporter, Singapore
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Sembcorp Marine disposes nine jackup rigs for $1.8b

Their worth is a 30% drop from the original value.

Sembcorp Marine disposed nine jackup rigs to Borr Drilling Limited (Borr) for $1.8b (US$1.3b).

According to DBS Equity Research, the price suggests an average resale price of $196.4m (US$144m) per rig, a 30% drop from the original contract value.

However, the loss of income is largely offset by deposits collected and provisions made.

DBS said Borr's upfront payment of US$502m would help to lower Sembcorp Marine’s net gearing by 0.25x.

Here's more from DBS Equity Research:

The successful disposal of all six terminated jackup rigs and three newbuild jackup rigs (options which customers failed to exercise) removes a major concern on SMM.

The only other jackup rig currently under construction for Japan Drilling is considered “safe” as it is backed by BOT Lease.

SMM will continue to actively market West Rigel - the harsh-environment ultra-deepwater semisubmersible rig built for financially distressed North Atlantic Drilling at a contract value of US$568m.

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