FPSO Bond Talking with Buyers

SBM Offshore’s SBM Baleia Azul unit is heard to be in discussions with buyers regarding its planned $500m bond financing for a floating production, storage and offloading vessel (FPSO). Mistubishi UFJ, Mizuho, Rabobank and TD are managing the sale, to be done as a private placement under the RegD format. The timing is unclear. The BBB rated 2027 bonds are backed by future revenues from a contract between Petrobras and SBM’s Cidade de Anchieta vessel, which initiated production Monday. The structure appears similar to transactions used to finance drillships with Petrobras contracts, but this would be the first time in LatAm it is used for an FPSO, an asset so far accustomed to the loan markets.