Nabors Priced Senior Notes at $700M - Analyst Blog

Nabors Industries Inc., a wholly owned subsidiary of Nabors Industries Ltd. (NBR), announced the pricing of Senior Unsecured Notes due 2020 at $700 million.
 
The notes carry an interest rate of 5.0% and will be fully and unconditionally guaranteed by Nabors Industries Ltd. With a yield of 5.056%, the notes are being offered at 99.564% of the face value. The offering is expected to close on September 14, 2010.
 
Nabors plans to use the net proceeds from this offering to capitalize on the previously announced acquisition of Superior Well Services Inc. (SWSI) and for general corporate purposes.
 
On August 10, 2010, Nabors announced that it has agreed to acquire oilfield services provider Superior Well Services for about $900 million. As per the deal, Superior Well shareholders would get $22.12 in cash for each share they hold, representing a total consideration of $735.6 million. Additionally, Nabors will assume $165 million in debt.
 
(Read the full coverage on the news at: Nabors Agrees to Buy Superior)
 
Barbados-based Nabors is a major land drilling contractor and conducts oil, gas and geothermal land drilling operations across the globe. The company owns and operates almost 550 land drilling and 728 land workover and well-servicing rigs in North America. In addition, Nabors' actively marketed offshore fleet consists of 39 platform rigs, 13 jackup units and 3 barge rigs in the United States and multiple international markets.
 
We are maintaining our long-term Neutral recommendation on the stock to account for the company’s leading position in most of the natural gas and oil-based shale plays, efficient management team and strong acceleration of shale gas drilling, partially offset by the volatile oil and gas prices and business risks associated with international exposure.
 
With an expectation that the stock will perform in line with the broader equity market, we have a Zacks #3 Rank (short-term 'Hold' recommendation) on Nabors’ shares.

 
NABORS IND (NBR): Free Stock Analysis Report
 
SUPERIOR WELL (SWSI): Free Stock Analysis Report
 
Zacks Investment Research