Transocean NKr9.1 billion acquisition of Songa Offshore

15/8/2017
Public acquisition

NKr 9.1 billion

$ 1.166 billion

Announced

15/8/2017


Overview:

  • Transocean, one of the world's biggest drilling rig operators, has agreed to buy Norwegian competitor Songa Offshore for NKr9.1 billion.
  • Clarkson Platou Securities served as financial adviser to the buyer, while Pareto Securities and ABG Sundal Collier acted in the same role for the target.
  • The offer values Songa shares at NKr47.50 ($5.97) each.
  • Including debt, the deal sets Songa's enterprise value at NKr26.4 billion ($3.4 billion).
  • The transaction will be settled in shares, cash and a convertible bonds.
  • It will boost sales from Swiss-based Transocean’s backlog by 35 percent next year to $2.7 billion, and by more than half in 2019 to $2 billion.
  • It is the biggest offshore drilling industry deal since oil prices collapsed three years ago.
  • On announcement of the deal, Songa’s stock surged 37%. However, Transocean’s stock dropped 5.7% to $7.91, its lowest in more than two decades, as investors criticised the deal.
  • It follows Transocean’s sale of its entire fleet of jack-up rigs to Borr Drilling for $1.35 billion earlier this year, and rival Ensco’s proposed acquisition of Atwood Oceanics. for $863 million.

Patrick Martinez-Brown - Journalist

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