Seadrill stops dividend payments

Norwegian offshore driller Seadrill will halt its dividend payments.

Oslo-listed Seadrill Ltd. said Wednesday that it was suspending dividend payments to cut debt and to help finance possible acquisitions amid expectations that oil field services companies will consolidate as they battle fallout from weak oil prices.

"The decision to suspend the dividend has been a difficult decision for the board," said Seadrill Chairman John Fredriksen, but he said it was the right way to deal with a "significant deterioration in the broader offshore drilling and financing markets over the past quarter."

By suspending its dividend, Seadrill expects its capital position to improve by $2 billion a year. The board has authorized a share buyback program of up to 10% of outstanding shares over the coming year.

"I am confident that Seadrill will emerge from this downturn even stronger and that we will resume our distributions in the future," Mr. Fredriksen said.

Source: Dow Jones

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