Offshore drilling contractor Noble Corp. said today that it is acquiring Pacific Drilling in an all-stock deal.
The agreement between the two Houston area-based firms has already been approved by a majority of their boards. Pacific Drilling shareholders will receive 16.6 million Noble shares, or almost 25% of the buyer’s outstanding stock.
Noble said it is acquiring the smaller rival’s assets on a zero-debt basis and that Pacific Drilling brings with it $30 million in liquidity.
On a pro-forma basis, Noble will operate a fleet of 24 drilling rigs: 11 drillships, 1 semisubmersible, and 12 jackups.
The combined company will move forward under the leadership of Noble’s current board of directors and executive management.
Offshore drillers have represented one the industry’s hardest hit business segments after exploration budgets plummeted during the 2015 downturn in crude prices. While unable to climb out of steep debts since then, the latest downturn in prices has placed many of them on bankruptcy watch or in the market for consolidation.
- Struggling contractor Offshore Diamond entered into bankruptcy protection in April of 2020 with a debt totaling more than $2.1 billion.
- In August of 2020, Valaris filed for bankruptcyto shed more than $7 billion in debt. The company was the result of a merger 2 years earlier by legacy offshore drillers Rowan Company and Ensco Drilling.
- In February this year, Seadrill and its subsidiaries filed for US bankruptcy protection in Texas courts.
- At least 26 offshore rigs have been shuttled to scrap yards since the latest pandemic-driven downturn began a year ago, according to data from IHS Markit.
