HAMILTON, Bermuda - Nabors Industries Ltd. (NYSE: NYSE:NBR), a leading technology provider for the energy sector, has announced the pricing of a $550 million senior guaranteed notes offering through its indirect wholly-owned subsidiary, Nabors Industries, Inc. (NII). The notes, which are set to mature on August 15, 2031, will carry an annual interest rate of 8.875% and were offered at par value to investors.
The sale of these senior notes is anticipated to close on July 22, 2024, subject to customary closing conditions. Nabors expects to net approximately $540.7 million after deducting offering expenses and commissions. The proceeds are earmarked for the redemption of Nabors' 7.25% senior guaranteed notes due 2026, with any remaining funds to be used for general corporate purposes, potentially including the repayment of other outstanding debt.
These senior unsecured obligations will rank equally with all of NII's current and future senior obligations, as well as the guarantees provided by Nabors and its subsidiaries, which also back the company's 7.50% senior guaranteed notes due 2028.
The offering targets qualified institutional buyers under Rule 144A and non-U.S. persons in accordance with Regulation S of the Securities Act of 1933, as amended. The notes have not been registered under the Securities Act or any state securities laws and may not be offered or sold within the United States absent registration or an applicable exemption from registration requirements.
InvestingPro Insights
In light of Nabors Industries Ltd.'s recent announcement regarding their senior guaranteed notes offering, a closer look at the company's financial metrics and market performance provides additional insights. According to InvestingPro data, Nabors currently holds a market capitalization of $852.9 million USD, reflecting its valuation in the eyes of investors. Despite challenging conditions in the energy sector, Nabors has managed a significant return over the last week, with a price total return of 17.5%. This short-term surge could be indicative of investor confidence in the company's strategic financial maneuvers, including the latest notes offering.
However, it's worth noting that analysts remain cautious about the company's profitability in the near term. An InvestingPro Tip suggests that Nabors is not expected to be profitable this year. This aligns with the reported negative Return on Assets of -0.43% for the last twelve months as of Q1 2024. Additionally, the company's Price/Earnings (P/E) Ratio stands at -6.17, further underscoring the profitability concerns. These factors are essential for investors to consider, especially those looking at the long-term prospects of their investments.
On a more positive note, another InvestingPro Tip highlights that Nabors' liquid assets exceed its short-term obligations, providing the company with a degree of financial flexibility. This is particularly relevant as the company plans to use the proceeds from the notes offering for debt repayment and other corporate purposes. Investors interested in deeper analysis and additional InvestingPro Tips can explore the extensive insights available at https://www.investing.com/pro/NBR, where they can also take advantage of a special offer using the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription. With 9 additional tips listed in InvestingPro, investors can gain a comprehensive understanding of Nabors' financial health and market position.
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