GE Energy Finances Drillship Deal

In its first equity investment in offshore drilling, GE Energy Financial Services, a unit of GE, will invest $54 million and co-finance the acquisition of a deepwater drillship working off the coast of Brazil.

An affiliate of GE Energy Financial Services, GE Capital Markets, is a Mandated Lead Arranger for $259 million in senior debt facilities along with WestLB AG, New York Branch, which serves as the Agent and other mandated Lead Arranger. GE Transportation Finance joined with GE Energy Financial Services in underwriting the debt.

These funds facilitate Mike Mullen Energy Equipment Resource Inc.'s acquisition of Peregrine I, a deepwater drillship under contract with Petrobras from a subsidiary of Transocean. The Peregrine I is drilling in the Atlantic Ocean off the coast of Brazil.

"By delivering comprehensive and integrated equity and debt solutions, GE Energy Financial Services and GE Transportation Finance demonstrated their creative approach to complex deals. In addition, we added a chapter in our Latin America expansion story in an area of key importance for us, Petrobras and Brazil," said Dan Castagnola, a Managing Director at GE Energy Financial Services in Houston.

The Peregrine I is rated to drill in 5,200 feet of water to a depth of 25,000 feet. A subsidiary of Etesco Construcoes E Comercio Ltda, an experienced Brazilian offshore rig operator, will operate the vessel under a contract with Petrobras. Mike Mullen Energy Equipment Resources, a Dallas-based offshore assets investor, and Pareto World Wide Offshore, a Norwegian private equity fund, are also investors in the Peregrine I.

"GE Energy Financial Services' track record as an investor in Latin America, its knowledge of the offshore industry and its ability to complete a complex debt and equity deal in a tight timeframe have spelled success," said Mike Mullen, CEO of Mike Mullen Energy Equipment Resources.

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