British offshore rig owner Ensco to buy rival Pride

7th February 2011, Comments 0 comments

British offshore rig operator Ensco said Monday it will buy US rival Pride International for about $7.3 billion in a deal creating the world's second-largest offshore driller.

The cash-and-stock deal is based on Ensco's closing share price of $41.60 Friday and represents a 21 percent premium for Pride the same day, the companies said in a joint statement.

"The transaction will create the second-largest offshore driller in the world," trailing global leader Switzerland-based Transocean, the firms said.

With an estimated value of about $16 billion, the new entity will have 74 rigs spanning all of the strategic, high-growth markets around the globe, the two firms said.

The deal was unanimously approved by each company's board of directors.

Dan Rabun, Ensco's chairman, president and chief executive, said the tie-up was a strategic fit with minimal overlap "that is ideally positioned to capitalize on growth opportunities within our industry."

"Pride has gained valuable expertise building and operating ultra-deepwater semisubmersibles and drillships and has strong relationships with leading customers in Brazil and West Africa, two of the fastest-growing deepwater markets in the world," Rabun said in the statement.

"Ensco is a leading provider of premium jackups and ultra-deepwater semisubmersible rigs with a major presence in the North Sea, Southeast Asia, North America and the Middle East."

The transaction was expected to close as soon as the second quarter of 2011, subject to shareholder approval.

Shares in Pride surged 15.96 percent to $39.88 in midday New York trade.

© 2011 AFP

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