Nabors starts exchange for 0% convertibles

New York, Nov. 12 - Nabors Industries Ltd. announced its Nabors Industries Inc. subsidiary has begun an exchange offer for its $700 million zero coupon senior exchangeable notes due 2023.

The Houston-based drilling contractor said it is making the offer because of changes in accounting regulations that would cause the existing notes to be treated as if they have been converted when calculating diluted earnings per share.

The new notes will have similar terms to the existing securities except that they will eliminate the requirement that Nabors pay for conversions in stock in certain situations such as a default.

In addition, the new notes will contain additional anti-dilution protection for cash dividends and tender or exchange offers for the company's stock. They will also include a make-whole provision payable in connection with certain fundamental changes involving Nabors.

The exchange runs through midnight ET on Dec. 10.

Georgeson Shareholder Communications Inc. is the information agent (banks and brokers call 212 440-9800; others call 800 325-5997). J.P. Morgan Trust Co. NA is exchange agent.

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