Offshore drilling and oil field service provider Aban Offshore is planning to raise more than Rs 4,500 crore through various market instruments to replace a portion of its expensive debt. Aban Offshore has a total debt of more than Rs 13,000 crore and has been struggling to repay its debt. The Reji Abraham-promoted company is now looking to raise Rs 2,200 crore through issue of FCCBs and GDRs and is also looking to raise an additional 2,500 crore through issue of shares to qualified institutional buyers.
Aban wants to keep the approvals from the shareholders ready so that when it wants it can go ahead with its plans to raise money. The company is awaiting shareholder approval to raise additional long-term resources through issue of FCCBs, GDRs and ADRs for about $400 million and an issue of equity related securities to qualified institutional buyers for 2,500 crore, a senior official from Aban said.
The Chennai-based company has been struggling to stay afloat after the company incurred massive debt due to its acquisition of Norway-based Sinvest for which Aban had to pay more than Rs 5,200 crore. The acquisition was done at a time when the prices of vessels remained very high in the backdrop of a boom in a global economy. But the subsequent global financial collapse and a fall in the crude prices affected fortunes of offshore companies across the globe.