Constellation emerged from bankruptcy protection in Brazil in June 2022, almost four years after filing to restructure some US$1.8 billion in debt. Now, with fresh capital from bondholders, less than US$900 million in debt at the end of 2023 and its local fleet of seven rigs fully contracted, the company expects the day rates it charges for its equipment to rise thanks to strong demand, Chief Executive Officer Rodrigo Ribeiro said in an interview.
Constellation Oil Services Holding SA’s bondholders are reaping a windfall due to increased demand for the company’s offshore rigs from Petroleo Brasileiro SA, a sharp recovery for a business that emerged from a debt restructuring less than two years ago.
While the group of holders is small, and liquidity is thin, notes due in 2026 have jumped roughly 25 cents since November 2022, handing investors a total return of around 45%, compared with an average of 16% for emerging-market corporates during that period, according to a Bloomberg gauge.
