The company is offering 300,000 units, with each unit comprising $867 senior secured notes due in 2018 in an aggregate principal amount equal to $260 million, and $133 million senior unsecured notes due 2018 in an aggregate principal amount equal to $39.9 million.
The notes are being offered to US institutional buyers.
The proceeds will be used to pay down debt under the company’s revolving credit facility.
The company also announced plans to amend that facility, reducing it from $450 million to $150 million, eliminating the maximum leverage ratio covenant, adjusting the interest coverage ratio covenant and adding covenants requiring maintenance of at least $30 million in liquidity.
The amendments are subject to the completion of the debt offering.
Credit agencies Moody’s Investor Services and Standard & Poor’s have downgraded Boart in recent months due to high debt and difficult operating conditions.
Drill utilisation rates fell to about 55% in the first half of the year from 80% a year earlier.
Boart is estimating full-year earnings before interest, tax, depreciation and amortisation to be at the lower end of analyst forecasts at $116-159 million, compared to EBITDA of $321.9 million in 2012.
Shares in Boart fell nearly 7% to A51.2c.