EuropeFinance and InsuranceOffshore

Songa raises new equity, mostly bought by its board

Oslo-listed Songa Offshore has raised NOK 212.7m ($25.5m) by issuing new shares, of which around 60% were purchased by members of its board.

The drilling rig owner offered and subsequently allocated and issued 1,418,100,000 new shares at a price of NOK 0.15 ($0.018) each.

The issuance is part of Songa’s “comprehensive refinancing” and will more than double its outstanding common shares to 2,292,010,000 in total. In April, the company also issued a $125m convertible bond, due 2022.

Of the newly issued common shares, Perestroika AS has been allocated 557,333,333 shares. The company is Songa’s biggest shareholder and is solely owned by its chairman Frederik W. Mohn.

After the transaction, Perestroika and its related parties own 43.5% of Songa’s common stock, plus just over 4m Class A shares.

Songa’s CEO Bjørnar Iversen was allocated 2,843,333 shares in the offering, and its CFO Jan Rune Steinsland has taken 1,443,333 shares, which will be added to the executives’ respective shareholdings.

Board members Mike Mannering, Arnoud Bobillier, and Johan Kristian Mikkelsen were also allocated shares in the offering.

The refinancing will provide much-needed liquidity and will “safeguard the operations of the company and the delivery of Songa Enabler, the company’s final Cat D newbuild”, the Oslo-listed company said on March 15.

The semi-submersible drilling rig is under construction at Daewoo Shipbuilding & Marine Engineering (DSME), which is suing Songa for $172m for cost overruns and design errors related to the Cat D rigs.

Holly Birkett

Holly is Splash's Online Editor and correspondent for the UK and Mediterranean. She has been a maritime journalist since 2010, and has written for and edited several trade publications. She is currently studying for membership of the Institute of Chartered Shipbrokers. In 2013, Holly won the Seahorse Club's Social Media Journalist of the Year award. She is currently based in London.
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