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CQS Rig Finance Fund Ltd (RIG)

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Thursday 19 May, 2011

CQS Rig Finance Fund Ltd

Monthly Shareholder Fact Sheet

                          CQS RIG FINANCE FUND LIMITED
                         Monthly Shareholder Fact Sheet

CQS  Rig Finance Fund Limited (the "Company"), a closed-ended investment company
incorporated in Guernsey, is pleased to announce that its Monthly Fact Sheet for
April 2011 is now available on the Company's website ( and
includes information on the top ten investments and outstanding borrowings.

Volatility  in risky assets continued into April. After an initial consolidation
of  the gains  in March,  the S&P  500 Index drifted  lower in the first half of
April  and sold off sharply after S&P cut  its outlook for US Treasury debt from
stable  to  negative.  Positive  earnings  data and macroeconomic sentiment then
drove  equities higher to finish the month up 2.9%, a new high for the year. The
price  of Brent Crude continued its recent steep rise closing up over 7% at $126
per  barrel. The Company's final NAV per share rose 1% on a like-for-like basis,
but  closed down 2% at 28.83 pence  against 29.50 pence at the  end of the prior
month, reflecting the Shares commencing to trade ex right on 13 April to receive
the 1.0 pence dividend payable in May.

Gains were seen on the Remedial Cayman Limited and Viking Drilling ASA positions
during the month. Following news of the sale of the second 'jack-up unit' for up
to  $87.5m (as  reported in  the January  Fact Sheet),  stage payments have been
received  by the Trustee and the proceeds have been used to partially redeem the
bonds.  A total of $31.5m was distributed to bondholders during April. Remaining
balances  are due to be  received by bondholders by  the end of September at the
latest.  Partial  distributions  were  also  made  from the bankruptcy estate of
Viking  Drilling during the  month. No further  material recoveries are expected
from  this  position.  The  bonds  are  now  marked  at zero in the books of the

There  were significant cash receipts  into the Company during  the month as the
CNOOC  9.75% position  matured  at  par  value  and  the  DDI 9.3% 2012 bond was
redeemed  early  at  a  premium  price  of  103. Proceeds  from these two events
amounted  to just under $3m  and have been partially  used to fund the 1.0 pence
dividend  payment due to  be paid on  11 May and will  be used to  invest in new

There were two new issues during the month. DryShips Inc. announced the issue of
an  unsecured five-year  bond of  $500m for  its majority-owned subsidiary Ocean
Rig.  The  bond  was  priced  with  a  fixed coupon of 9.5%. The proceeds of the
offering  are expected to be  used to finance Ocean  Rig's new Ultra Deep drill-
ship building program and for general corporate purposes.

Polarcus  Limited announced  the issue  of a  secured five-year convertible bond
paying  2.875% coupon. The bonds are convertible  into common shares of Polarcus
at  a premium  of 32.5% to  the reference  price. The  proceeds will  be used to
finance  the  construction  of  the  Polarcus  Selma,  a  seismic vessel due for
delivery  in Q3  2011. The vessel  will then  form security,  via a 1st priority
pledge, for the bond. The Company subscribed for both new issues.

For further information, please contact:

Lynette Le Provost
Corporate Secretariat
Kleinwort Benson (Channel Islands) Fund Services Limited
01481 727111

Hugh Field
Director, Corporate Finance
Arbuthnot Securities
020 7012 2000
All market data sourced from Bloomberg

This announcement is distributed by Thomson Reuters on behalf of 
Thomson Reuters clients. The owner of this announcement warrants that: 
(i) the releases contained herein are protected by copyright and 
    other applicable laws; and 
(ii) they are solely responsible for the content, accuracy and 
     originality of the information contained therein. 
Source: CQS Rig Finance Fund Ltd via Thomson Reuters ONE