#Bermuda #Hamilton #Paratus Energy #Borr Drilling #Jack-up Business

Paratus Energy Services Ltd. Sells Jack-up Business

In a significant move to enhance its operational strategy and financial standing, Paratus Energy Services Ltd. (ticker: PLSV) unveiled today its agreement to sell its jack-up business, including the operations of its indirect subsidiary Fontis Finance Ltd., to Borr Drilling Limited and Proyectos Globales de Energía y Servicios CME, S.A. de C.V. This transaction marks a pivotal phase for Paratus as it seeks to consolidate its position in the competitive energy services industry.

Transaction Overview

The sale is structured through two inter-conditional agreements. First, CME will purchase Fontis's Mexican operations for cash, while the Singapore-based rig-owning entities will be acquired by Borr and CME via a jointly owned acquisition vehicle, involving a mix of cash and seller's credit. This dual-structured deal not only streamlines operations but also taps into existing networks and expertise from well-established players in the energy sector.

Since acquiring Fontis in 2022, Paratus has carefully navigated a path of restructuring and debt repayment, successfully distributing around USD 760 million in asset value to stakeholders. This includes a significant sum of USD 541 million earmarked for Paratus, showcasing the value generated during its stewardship of Fontis. Under Paratus’s leadership, Fontis has severed ties with Seadrill, eliminated external debt, and made commendable progress in collecting outstanding receivables.

Strategic Rationale Behind the Sale

The decision to divest Fontis comes with a robust strategic rationale aimed at enhancing Paratus's flexibility in both operational and financial matters. By shedding its jack-up business, Paratus reduces its exposure to payment delays and uncertain contracting environments particularly prevalent in Mexico. This divestment aligns with an ongoing effort that began with the sale of holdings in Archer, which the company executed in Q3 2025.

Paratus is a unique entity in the energy services market, being the only pure-play PLSV (Platform Supply Vessel) operator of substantial scale. Following the sale, the company will run a fully-contracted fleet that delivers long-term earnings visibility in a sector characterized by resilient infrastructure needs. The leadership anticipates that the improved cash flow will enable stable shareholder distributions, reinforcing confidence in maintaining current dividend levels.

Financial Details of the Transaction

The financial specifics of the deal involve a purchase price of USD 400 million for Fontis’s operations. This figure breaks down as follows:

• - USD 148 million payable at closing,
• - USD 15 million in deferred considerations contingent upon the receipt of payments by Fontis exceeding USD 60 million after December 2025, and
• - USD 237 million non-recourse seller’s credit, secured by a lien over the rig assets, with an ascending interest rate starting from 10% for the initial year.

The agreements are conditional on customary closing terms and require consent from bondholders, while closing is anticipated within the second half of 2026, pending the timely fulfillment of these conditions.

Management Commentary and Future Outlook

Robert Jensen, the CEO of Paratus, remarked, “This announcement signifies a major milestone in Paratus's evolution. Our achievements over the past years have positioned us well for future growth. This transaction represents a strategic leap toward establishing Paratus as a leading player in the PLSV sector.”

Chairperson Mei Mei Chow echoed similar sentiments, underscoring the continual commitment to maximizing shareholder value. With two divestments concluded successfully, Paratus is now focused on streamlining operations and reinforcing its financial foundation, facilitating a path toward growth and stability.

Investor Communication

To provide stakeholders with additional insights, Paratus has scheduled an investor update call on March 24 at 1500 CET, where governance and subsequent financial strategies will be discussed in further detail. Participants can register for the call through the link provided in the company’s announcement.

This move, whilst reflective of the challenges within the sector, signals Paratus's proactive approach and unwavering commitment to its accelerated growth trajectory and long-term shareholder value.