Mermaid

Mermaid: its associate, Asia Offshore Drilling (AOD) is planning a private placement to raise gross proceeds of US$53 – 105m, subject to sh/h approval. It has received an indicative price of US$5 -5.50 during a book building exercise, similar to its Apr ’11 OTC price of NOK30/sh (~US$5.59). This values Mermaid’s current 49% stake in AOD at btwn US$50-55m...

Mermaid intends to subscribe for btwn US$10-27m (~18.9% of placement size) in the private placement.
Net proceeds will be used to exercise 1 or 2 of AOD's fixed price options for the construction of high-specification jack-up rigs with Keppel FELS. It will also be used for project mgt, and as working capital and SG&A...

AOD has retained SEB Enskilda, Pareto Securities and RS Platou as Joint Lead Mgts and Bookrunners.
Recall, AOD has applied for listing on Oslo Acess, and targets listing by end of Jun ‘11.

CIMB has a Neutral rating on Mermaid with $0.41 TP.