ADES International Holding, the London-listed company providing offshore and onshore oil and gas drilling and production services in the Middle East and Africa, said it secured a SAR525 million (US$140 million) standby credit facility from Saudi Arabia’s Alinma bank.
The KSA Facility will be used to finance the acquisition of three operational offshore jack-up rigs from Nabors Industries, for which the company signed a purchase and sale agreement in December 2017, in addition to other potential acquisitions of rigs to be operated in the Kingdom of Saudi Arabia.
This KSA Facility adds to the recently secured US$450 million facility arranged by the Bank of America Merrill Lynch and the European Bank for Reconstruction and Development and further enhances the group’s purchasing power.
The KSA Facility has a 7-year tenor with a 24-month grace period. Its profit rate is highly competitive and is in line with prevailing market rates in Saudi Arabia; and repayment of the principal amount will commence 24 months from the signing date and will be calculated using the straight-line amortisation method, with a fixed repayment rate of 11.1 per cent, payable semi-annually, ADES said.
Dr. Mohamed Farouk, CEO of ADES International Holding, said: “Coupled with the $450 million facility we secured in March, the new KSA Facility is testimony to the confidence placed in ADES by major regional and international banks. It underlines our commitment to putting new debt arrangements in place and enhances our already strong cash position following last year’s IPO.
Farouk said ADES is participating in multiple tenders and screening acquisitions across Saudi Arabia and the wider GCC region, and this KSA Facility further strengthens the company’s purchasing power, providing it with greater flexibility to consider and act swiftly on value-accretive acquisitions.