SeaDrill Limited (NYSE:SDRL) declared that it has come into a settlement agreement with Hyundai Samho Heavy Industries Co. Ltd (HSHI). This is in relation to the West Mira arbitration.
Settlement details
As a part of the full settlement, Seadrill will receive $170 million in cash in March 2017. The arbitration process commenced in October 2015. This was after the cancellation of the West Mira construction contract. The construction was expected to conclude in the first half of 2018. The agreement concludes the arbitration process earlier than expected.
The compensation
The company will receive non-cash compensation of about $44 million which represents the value difference between cash payment expected to be received and West Mira’s receivables carrying value. Seatankers a related party has bought West Mira from HSHI as part of the settlement process.
Technical and commercial management of West Mira
Seatankers as an asset holding company is not expected to get involved in offshore drilling works and engage into competition with Seadrill. The company hopes that it can reach into an agreement with Seatankers in relation to the technical and commercial management of the West Mira. This is to include the right of the first refusal for the acquisition of West Mira.
Forward looking statements
The announcement involves forward looking statements which are generally not historical in nature and in particular relate to Company’s goals and strategies, changes, prospects and trends in the markets specific to the company. They are based on the current plans, assumptions, beliefs and expectations of the management. They also include assumptions, risks and uncertainties that could result to material differences from the actual. Therefore these statements cannot be guaranteed.
The company has no obligation to include any updated forward looking statements to accommodate any new events or circumstances unexpected in the future. The company is also not in a position to determine the effects of new factors that may come up in the future and result to material differences between the actual and the forward looking statements.
The information is a content of disclosure requirements according to section 5-12 of the Trading Act of the Norwegian Securities.
