Transocean moves to acquire Songa Offshore

Transocean has moved to take over Songa Offshore making a public voluntary exchange offer of NOK47.50 ($5.96) per Songa Offshore share. The deal gives Songa Offshore an enterprise value of NOK26bn ($3.26bn). The offer price represents a 39.7% premium to Songa Offshore’s closing share price yesterday.

“The acquisition will strengthen Transocean’s position as the leading offshore driller with exposure to deep- and harsh-water markets. Upon closing, Transocean will add four high specification harsh environment floaters, in addition to three legacy mid-water harsh environment rigs. In addition to contributing approximately $4.1bn in backlog, the transaction is expected to be immediately accretive to Transocean’s earnings. The combined company will have a fleet of 53 rigs, comprised of ultra-deepwater drillships, harsh environment semis and deep- and mid-water semisubmersibles, combined with 9000 employees”, said Jeremy Thigpen, CEO of Transocean.

Perestroika, Songa Offshore’s largest shareholder, will through the offer become Transocean’s largest shareholder, with a holding of shares and rights to shares equal to approximately 12% of the combined entity on a fully diluted basis.

“The combination of Songa Offshore and Transocean is a strategic fit. The combined company will have an unparalleled backlog backed by strong counterparties. By adding Songa Offshore’s four Cat-D rigs to Transocean’s existing harsh environment fleet, the combined company will be the leader within this segment which is showing signs of recovery “, said Frederik Mohn, chairman of Songa Offshore.

Transocean is in a cash-rich position thanks to the $1.35bn sale of its entire jackup rig fleet to Borr Drilling earlier this year.

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.
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