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Successful Issue of USD300 Million Bond

2017-12-06 00:53
-Removes Near Term Debt Risk and Improves Liquidity and Achieves Credit Rating Upgrade

HONG KONG, Dec. 6, 2017 /PRNewswire/ -- Anton Oilfield Services Group ("Antonoil" or the "Group", HKEx stock code: 3337), a leading independent oilfield services provider in China is pleased to announce the successful issuing of a USD300 million bond with a coupon rate of 9.75% and due 5 December, 2020, whose settlement was completed today. About USD176 million of the USD300 million bond was issued to existing investors in exchange for the Group's bond maturing on 6 November, 2018. Bondholders holding more than 70% of the existing bond participated in the exchange. Following the successful exchange, the Group issued bonds worth USD124 million to new investors, which were equally oversubscribed with orders of USD170 million. In the end, about 81% was allocated to long-term funds and asset management companies, 18% to insurance companies, and 1% to private banks.

The Group captured the opportunity of a turnaround in the oil and gas industry and the recovery of its businesses, and acted proactively to issue such bond. Through the combination of an exchange offer and a new issue, the Group has completely removed, one year in advance, the risk stemming from the repayment of the existing USD250 million bond due in 2018. After completing the settlement today, the international rating agency Moody's released a press release, raising both the corporate and bond rating of the Group to B3 with a positive outlook. Lu Chenyi, Vice President of Moody's said: "The higher rating reflects the significant improvement in Anton's liquidity and repayment ability thanks to the successful refinancing, as well as our expectation of a continuous improvement in Anton's financial situation in the next 12 to 18 months."

The bond issuance is at the last window of opportunity in 2017. Due to the large number of foreign bond issuance applications in the market, the bond supply has dramatically increased in the short term, and several companies announced that their issues have failed and that they are withdrawing from the market, creating a tense bond market. In addition, as required by Regulation S, the Group had to wait 10 trading days in the market before being allowed to set the final price of the exchange offer, and thus faced a relatively large market risk in the early stage of issuance, so much so that at one stage the issue looked impossible to complete. Despite these factors, the Group benefited from the recovering and stabilizing oil price and from the significant improvement in company results. On the back of smooth communication with the capital market as well as trust from investors in the Group, the Group arranged roadshows in Singapore, Hong Kong and London after announcing the deal, met with over 100 investment funds, and received very positive feedback from the market. Numerous high-quality funds were bullish about the creditworthiness and growth prospects of the Group. Thanks to the strong support from investors, the Group successfully completed the issuance in a volatile bond market environment, with not only a high participation rate from existing bondholders for the exchange offer, but also ample new orders for the bond.

Since 2013, Brent oil price has dropped from 120 USD per barrel to 27 USD per barrel, and the Group has faced its toughest trough of the market. Facing extreme difficulties and pressure, the Group proactively explored the overseas markets, and firmly reduced costs and increased efficiency. During the last four years, it not only survived the market crisis, but also achieved revenue growth with profit in first half of 2017, and realized a turnaround towards business recovery and growth. The successful issuance of the bond has removed the largest barrier to business growth. In the next three years, the Group will continue to work towards the goal of becoming the 'most competitive production-increasing cost-reducing integrated technical services company in emerging global markets of the oil and gas development field', actively and comprehensively exploring unconventional oil and gas markets in both China and emerging markets worldwide, with a focus on creating cashflow, promoting healthy development of its business, and achieving a strong comeback with a better outlook!

About Anton Oilfield Services Group

Anton Oilfield Services Group (HKEx stock code: 3337) is a leading independent integrated oilfield services provider. The Group provides products and services for the entire process of oil and gas development and production, including integrated services, drilling technology, well completion and oil production services. The Group has established an international network across China and overseas markets, offering products and services in 14 countries including China and those in the Middle East, Central Asia and Africa area, and America. The Group is empowered to help oil companies solve their challenges in increasing production, improving drilling efficiency, lowering costs and optimizing waste management on multi-fronts. Its fast growth benefits from China's advantages in natural resources and the Group's increased presence in overseas markets. Anton Oilfield is the best independent Chinese oilfield services partner, the best Chinese partner worldwide. The Group's strategic objective is to become a leading global oilfield services provider with a solid foothold in China.

Source: Anton Oilfield Services Group

Related stocks: HongKong:3337 OTC-PINK:ATONY

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