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Msg  36986 of 36988  at  3/12/2019 6:24:38 PM  by

TonsbergDescendant


Seadrill Partners recent PPS movement

 I have to wonder if the ~ 20% cumulative SDLP PPS collapse on Monday and Tuesday, which followed a period of days when the price seemed to have some magical support at exactly $1.00 throughout the trading day, is tied to some thought that SDLP might be acquired by SDRL.  Alternatively, perhaps a fear that SDLP might be cut loose by SDRL. 
 
 I suspect some existing large, non-insider, owners of SDRL or SDLP might be thinking as much.
 
 I'm not so sure ... but I have been wrong numerous times in my past.
 
FWIW, between the time of the $1.00 support that seemed to end last week, and the price collapse of SDLP this week, what happened was the deadline date to reply on SDRL's 2/22/19 Consent Solicitation occurred at 5pm this past Friday .... and on Monday SDRL announced that 89% approved the solicitation to tender their NSN's to SDRL.
 
My guess is the SDLP PPS movement since 2/22/19 had to do with the collateral that SDRL provided on its NSN. Being that if the NSN are paid down as SDRL plans, but then subsequently assuming an asset sale occurred at SDRL, which of the assets that collateralize the NSN might SDRL sell?
 
If the SDRL Board were to approve an asset sale, my guess is they would be more likely to try and sell the assets that are not core to their offshore drilling business and tied to the NSN. The NSN collateral includes quite a few different assets that SDRL pledged on the $880 Mn of NSN that they issued when they raised the $1Bn of new cash for the BK.  I think the SDLP shares could be one of those pledged assets, but so do I think could be the 6 PLSV JV business,  and perhaps the rights to the 8 jackup newbuilds and their deposits, the ownership in Archer Drilling might be another, even the 5 jackups working under SeaMex could be in that long list.  I'm pretty sure the collateral is listed in one of those thousands of bankruptcy papers that SDRL filed with the court. 
 
Maybe different buyers even; depending on what might be sold off?  My gut says the 6 PLSV Seabras and the 8 newbuild jackups might be sold off.   Thus, I'm not so sure the SDLP PPS drop is anything but some nervousness.  T.D. 


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