Borr Drilling's Strategic Reinvention: How Leadership and Liquidity Fuel a $470M EBITDA Path

Borr Drilling Limited (BDR) is undergoing a strategic transformation that positions it as a compelling case study in leadership continuity and financial resilience. With a $470 million adjusted EBITDA target for 2025, the company's recent CEO succession plan and liquidity-strengthening measures are not just operational adjustments—they are catalysts for unlocking long-term value in a volatile offshore drilling sector.

Leadership Reinvention: A Blueprint for Stability

The appointment of Bruno Morand as CEO, effective September 1, 2025, marks a calculated shift toward internal promotion and strategic governance. Morand, a 20-year industry veteran who has served as Chief Commercial Officer since 2023, brings a proven track record in expanding Borr's global client base and optimizing capital allocation. His transition to CEO is paired with Patrick Schorn's move to Executive Chairman, ensuring continuity in the company's seven-year growth trajectory under Schorn's leadership.

This leadership structure is further reinforced by the addition of Thiago Mordehachvili, a major shareholder and CIO of Granular Capital, to the Board. Mordehachvili's expertise in capital markets and M&A aligns with Borr's ambitions to pursue inorganic growth opportunities. Meanwhile, Dan Rabun's role as Lead Independent Director adds a layer of objective oversight, balancing the board's strategic and operational focus.

The succession plan's emphasis on internal promotion and shareholder alignment reflects a broader industry trend: the need for agile, customer-centric leadership in a market where technical utilization (99.6% in Q2 2025) and economic utilization (97.8%) remain critical metrics. By retaining institutional knowledge while infusing fresh capital and governance expertise, Borr is hedging against the risks of external disruptions.

Liquidity as a Strategic Lever

Borr's financial resilience is anchored in a $425 million liquidity position as of Q2 2025, bolstered by a $102.5 million equity raise and an expanded $200 million Super Senior Revolving Credit Facility (SSRCF). These measures, combined with a $35 million senior secured RCF contingent on a $100 million equity raise, provide the company with the flexibility to navigate near-term uncertainties, such as delayed payments from Pemex in Mexico.

The company's liquidity strategy is particularly noteworthy given its 84% 2025 contract coverage at an average day rate of $145,000. This visibility into future cash flows, coupled with a reduced minimum liquidity requirement in its covenants, allows Borr to allocate capital toward high-impact opportunities. For instance, the Mexican government's $13 billion facility to support Pemex's liquidity is expected to stabilize Borr's $65 million in outstanding payments, reinforcing its 2026 coverage in the region.

EBITDA Potential: A Calculated Path

Borr's $470 million adjusted EBITDA target is underpinned by a disciplined capital allocation strategy that prioritizes utilization over aggressive day rate negotiations. Management's mantra—“utilization remains king”—has driven 14 new contract awards in 2025, adding $318 million to its backlog and extending visibility into 2026. This approach, while pragmatic, also mitigates exposure to market volatility, as evidenced by the company's 97.8% economic utilization rate.

The company's strategic focus on Southeast Asia and the Middle East—markets with robust drilling demand—further diversifies its revenue streams. With 14 jackup rigs in operation and a fleet optimized for shallow-water projects, Borr is well-positioned to capitalize on regional demand cycles.

Investment Implications

For investors, Borr's strategic transformation presents a balanced risk-reward profile. The CEO succession plan and board refreshment signal a commitment to long-term governance, while the liquidity enhancements provide a buffer against cyclical downturns. However, the company's reliance on Pemex and its exposure to Mexico's regulatory environment remain tail risks.

The $470 million EBITDA target is achievable if Borr maintains its current utilization rates and executes on its capital-raising initiatives. A key inflection point will be the August 6, 2025, shareholder vote on Mordehachvili's board nomination, which could accelerate M&A activity or asset optimization.

In a sector where operational efficiency and liquidity are paramount, Borr Drilling's strategic moves demonstrate a clear-eyed focus on value creation. For those willing to navigate the sector's volatility, the company's leadership-driven transformation and financial discipline offer a compelling case for long-term investment.