Noble Corporation has agreed to acquire Pacific Drilling in all-stock transaction. Noble has its operational headquarters in Sugar Land while Pacific is based in west Houston.
The shareholders of Noble will own 75% of the combined company. It currently operates 19 drilling rigs, while Pacific operates 7. However, Noble said it plans to sell the Bora and Mistral rigs that are currently idle.
There’s little overlap in the customers or the territories between the companies. Pacific currently has three rigs running, one in the US Gulf of Mexico (for Murphy), one in West Africa and one in the Mexican side of the Gulf of Mexico (both for Petronas). Noble is not currently operating in the latter two territories.
Both companies have recently exited bankruptcy protection. Noble filed for Chapter 11 in July 2020. $3.4 billion of unsecured debt was exchanged for 86% of the newly reorganized company and the company exited in February 2021.
Pacific filed in November 2020 for the second time in three years. It emerged from bankruptcy on December 31, 2021. Bondholders exchanged $1.1 billion of debt for 91.5% of the equity in the new company.
Neither company has stock that is currently traded, so no value of the transaction was disclosed. I would expect Noble to re-list in the near future. Noble is forecasting at least $30 million of annual synergies. The combined company will be run from Sugar Land.
The transaction is expected to close in April 2021.