Amendment Bank Agreements and Contemplated Private Placement

1/14/2013 2:42 AM EST

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN 
WHOLE OR IN PART DIRECTLY OR INDIRECTLY, IN 
AUSTRALIA, CANADA, JAPAN OR THE UNITED STATES

Oslo, 14 January 2013 

Sevan Drilling ASA (the "Company") announces 
amendments to its existing loan agreements with its 
lending banks and proposes a private placement of NOK 
987 million (equivalent to ~USD 175 million) through 
an issue of new shares in the Company directed 
towards Norwegian and international investors 
(the "Private Placement"). 

The Company has retained Pareto Securities AS and 
Swedbank First Securities (collectively referred to 
as the "Joint Bookrunners") as joint lead managers 
and joint bookrunners and Carnegie as co- manager for 
the Private Placement. Rothschild is acting as 
financial adviser to the Company.

Waivers and amendment agreements with lending banks

As announced on 2 January 2013, the Company has been 
granted extended waivers from its lenders until the 
end of February 2013. Lenders to both the Sevan 
Driller and the Sevan Brasil syndicated facilities 
have been supportive of the contemplated Private 
Placement and have formally agreed on to waive all 
covenants to facilitate this process. Furthermore, 
the facilities have been amended in order to make 
them more self-sufficient and thus limit parent 
company funding of any shortfall going forward, all 
subject to raising of additional equity as 
contemplated by the Private Placement.

"The amendments to the bank facility, will allow 
Sevan Drilling to retain its low cost of debt. 
Combined with the proceeds from the Private 
Placement, Sevan Drilling's current funding gap is 
resolved and the strengthened balance sheet increases 
our attractiveness as contractor with potential new 
clients", says CEO Scott Kerr. 

Mr. Kerr adds: "We have gained vital experience from 
completing the start-ups of Sevan Driller and Sevan 
Brasil, and we are confident that we will deliver 
newbuilds Rig #3 and Rig #4 on time and budget. 
Furthermore, marketing is progressing well and we 
expect to secure a contract for Rig #3 during Q1 
2013".

The Private Placement

The gross proceeds from the contemplated Private 
Placement are expected to amount to NOK 987 million 
(equivalent to ~USD 175 million). The price in the 
Private Placement will be determined through an 
accelerated bookbuilding process. The minimum order 
and allocation has been set to the number of shares 
that equals an aggregate purchase price of at least 
the NOK equivalent of EUR 100,000. 

The net proceeds to the Company from the Private 
Placement will be used as follows: (i) USD 40 million 
in payment of deferred liabilities and CAPEX, (ii) 
USD 35 million in pre-payment of bank debt, and (iii) 
for general corporate purposes.

In connection with the Private Placement, as the 
Company's primary insiders will not be allowed to 
participate in the Subsequent Offering (as defined 
below), the Company has directed a separate tranche 
towards these primary insiders. In this respect, i.a 
the Company's CEO, Scott Kerr, CFO Jon Wilmann, and 
director Kitty Hall has confirmed subscriptions of, 
respectively, NOK 1 million, NOK 1 million and NOK 
200,000. 

The bookbuilding period commences today, 14 January 
2013, at 09.00 CET and may close at any time on short 
notice. 

The completion of the Private Placement will be 
conditional upon the following conditions being 
satisfied:

·	all necessary corporate resolutions being 
validly made, including without limitation approval 
by an extraordinary general meeting of the Company 
expected to be held on or about 6 February 2013 
(the "EGM");
·	payment being received for the shares to be 
issued in the Private Placement;
·	registration of the share capital increase in 
the Company pursuant to the Private Placement in the 
Norwegian Register of Business Enterprises; and
·	Execution of amendment agreements with the 
Sevan Driller and Sevan Brasil bank syndicates on 
terms in all material respects as agreed and 
described in the Investor Presentation.

The Company reserves the right to close the book and 
complete the Private Placement at a level between NOK 
828 million and NOK 987 million (equivalent to 
between ~USD 150 million and ~USD 175 million), 
subject to agreement with the Company's senior 
lenders. The Company also reserves the right to 
complete the Private Placement at a higher level than 
NOK 987 million.

Subject to successful placement of the Private 
Placement, the Board of Directors intends to propose 
a subsequent offering (the "Subsequent Offering"). 
The subscription price in the Subsequent Offering 
will be the same as in the Private Placement. The 
Company's shareholders as of 14 January 2013 (as 
documented by the shareholder register in the VPS as 
of 17 January 2013), and who are not resident in a 
jurisdiction where such offering would be unlawful, 
or would (in jurisdictions other than Norway) require 
any prospectus filing, registration or similar 
action, will receive non-transferable subscription 
rights based on their shareholding as of that date. 
Shareholders holding 300,000 shares or more as of 14 
January 2013 and shareholders allocated shares in the 
Private Placement will not receive subscription 
rights and will not be eligible to participate in the 
Subsequent Offering. Funds that are under management 
by the same company, group of companies, fund manager
(s) or similar may be treated as one shareholder when 
applying these limitations.

Enclosed: Company Presentation dated 14 January 2013 

As logistical circumstances beyond the Company's 
control have deferred the time of launch of the 
Private Placement and a neutralizing of information 
is required, Oslo Børs has, after a concrete 
assessment and in order to maintain an orderly 
market, accommodated a request from the Company to 
suspend trading in the shares while the bookbuilding 
is ongoing.

* * * * *

For further information, please contact:

Scott Kerr, CEO (+47 992 83 890)	
Jon Wilmann, CFO (+47 905 60 406)



****

This press release does not constitute or form part 
of an offer or solicitation to purchase or subscribe 
for securities in the United States. The securities 
referred to herein may not be offered or sold in the 
United States absent registration or an exemption 
from registration as provided in the U.S. Securities 
Act of 1933, as amended. The Company does not intend 
to register any portion of the offering of the 
securities in the United States or to conduct a 
public offering of the securities in the United 
States. Copies of this announcement are not being 
made and may not be distributed or sent into the 
Australia, Canada, Japan or the United States.

Certain statements contained herein that are not 
statements of historical fact, may constitute forward-
looking statements. Forward-looking statements 
involve known and unknown risks, uncertainties and 
other factors that could cause the actual results or 
events concerning the Company to be materially 
different from the historical results or from any 
future results expressed or implied by such forward-
looking statements. Although the Company has 
attempted to identify important factors that could 
cause actual events or results to differ from those 
described in forward-looking statements contained 
herein, there can be no assurance that the forward-
looking statements will prove to be accurate as 
actual future events could differ materially from 
those anticipated in such statements. Except as may 
be required by applicable law or stock exchange 
regulation, the Company undertakes no obligation to 
update publicly or release any revisions to these 
forward-looking statements to reflect events or 
circumstances after the date of this release or to 
reflect the occurrence of unanticipated events.

This information is subject of the disclosure 
requirements pursuant to section 5-12 of the 
Norwegian Securities Trading