Moody's rates Transocean Aquila notes B2

Moody's Investors Service said it assigned a B2 rating to Transocean Aquila Ltd.'s planned $300 million of senior secured notes due 2028.

The Transocean Aquila notes will be secured by a first lien on the Deepwater Aquila. The Deepwater Aquila is under a three-year contract with Petroleo Brasileiro SA that is scheduled to start in the summer of 2024.

“The proposed Transocean Aquila secured notes are rated B2, in line with the rig-secured notes of Transocean's indirect subsidiaries. The rating is one notch below the senior secured revolving credit facility's B1 rating because of the Transocean Aquila notes' security interest in only one drillship and the cash flow generated from its contract, and the potential for any residual claims from these notes to become subordinated to secured claims at Transocean, which has provided an unsecured guarantee to these notes,” Moody’s said in a press release.

Concurrently, the agency affirmed the issuer’s parent Transocean Inc.'s Caa1 corporate family rating, Caa1-PD probability of default rating and its various ratings. The SGL-3 speculative grade liquidity rating is unchanged.

Transocean will use the proceeds to pay the final costs of its seventh generation newbuild ultra-deepwater drillship, Deepwater Aquila, and to pay for the cost of additional equipment to ready the rig for work offshore Brazil.

The outlook remains positive.

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