SINGAPORE (March 21): CIMB is upgrading Keppel to “hold” from “reduce” after the rigbuilder says the contracts with Transocean for the five Super B jack-up rigs will be novated to Borr Drilling at US$216 million ($302 million) per rig.
That is almost at a zero discount to its original price of US$219 million per rig.
“We think the Borr contract is a good reference point for ‘realisable value” of undelivered rigs... However, there could still be some impairment in 2017 for mothballing of Singapore yards,” says analyst Lim Siew Khee in a Tuesday report.
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