Moody's rates Seadrill B1, notes B2

Moody's Investors Service said it assigned first-time ratings to Seadrill Ltd., including a B1 corporate family rating, a B1-PD probability of default rating, an SGL-1 speculative grade liquidity rating and a B2 rating to senior secured notes issued by Seadrill Finance Ltd. The outlook is stable.

"Seadrill's high-quality drilling fleet and focus on key regional markets allow it to successfully compete with larger scale offshore drillers," commented Thomas Le Guay, a Moody's senior analyst, in a press release. "The company's strong revenue backlog and commitment to conservative financial policies should provide resilience in a highly competitive and deeply cyclical industry."

As of March 31, Seadrill had a backlog of $2.6 billion and Moody’s said it estimates the company will have Moody’s-adjusted leverage of about 1x for 2023.

Seadrill's notes are rated B2, one notch below the B1 CFR, given the size of the $225 million super senior revolving credit facility, the agency explained.

The company will use the proceeds to repay indebtedness and for general corporate purposes.

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