Noble Drilling and Pacific Drilling Announce Merger

Noble Corporation and Pacific Drilling Company LLC announced today that they have entered into a definitive merger agreement under which Noble will acquire Pacific Drilling in an all-stock transaction.  The definitive merger agreement was unanimously approved by each company's Board of Directors. The transaction has also been approved by a majority of Pacific Drilling's equity holders, and no shareholder vote is required for Noble to close the transaction. As part of the transaction, Pacific Drilling's equity holders will receive 16.6 million shares of Noble, or approximately 24.9% of the outstanding shares of Noble at closing. Noble expects to realize annual pre-tax cost synergies of at least $30 million, and additionally, will move to dispose of the Pacific Bora and Pacific Mistral expeditiously. The transaction is subject to customary closing conditions and is expected to be completed in April 2021.

Noble's President and Chief Executive Officer, Robert Eifler, said, "The acquisition of Pacific Drilling will enhance our position in the ultra-deepwater market through the addition of its technologically advanced ultra-deepwater drillships, which are highly complementary to Noble's existing fleet. By bringing these modern drillships into the Noble fleet, we will be able to better serve the needs of our customers globally and to participate in a wider range of drillship tender activity.  The combination brings together two companies who share a common culture prioritizing safety and operational excellence. Additionally, the acquisition expands and further solidifies our relationship with certain key customers, facilitates re-entry into both the West African and Mexican regions, and strengthens our presence in the US Gulf of Mexico."

Mr. Eifler continued, "This acquisition is a positive strategic step for Noble, and we will work expeditiously to close the transaction and integrate the two companies. We remain committed to generating shareholder value through safety and operational excellence, capital discipline and customer satisfaction. As the offshore drilling landscape evolves, we look forward to maintaining our leadership role as we continue to grow in concert with the needs of our customers."

Bernie Wolford, Pacific Drilling's Chief Executive Officer, stated, "Bringing together the Pacific Drilling and Noble fleets creates a stronger and more stable combined company with the scale to provide solutions for our clients on a global basis.  This combination will advance the ongoing recovery in the industry and will allow Pacific Drilling equity holders to fully participate in that recovery. I would like to personally thank the entire Pacific Drilling team for their unwavering commitment to delivering safe, efficient and reliable services to our customers, and we look forward to working with Noble to successfully integrate the two companies."

Significant Value Creation Potential for Noble Shareholders and Pacific Drilling Equity Holders

Pacific Drilling's high specification UDW drillships are complementary to Noble's high specification fleet: The combined fleet will be one of the youngest and most technologically advanced fleets in the industry. The complementary nature of both drillship fleets will permit sharing of expertise, capital spares and equipment across the rigs. For example, both companies utilize the same original equipment manufacturers for engines, thrusters, well control and drilling equipment.

Shared culture and commitment to operational excellence: Noble and Pacific Drilling both operate with a commitment to best-in-class safety performance and environmental stewardship. A key component of both companies' value proposition also includes delivering the most efficient and reliable drilling performance to the customer.

Expansion of Noble's customer relationships and geographic footprint: The acquisition facilitates Noble's reentry into the growing West Africa and Mexico regions, and broadens its customer relationships. Given Noble's fully contracted drillship fleet, these additional assets will also allow participation in key drillship tendering activity.

Meaningful cost synergies: Noble expects to realize annual pre-tax cost synergies of at least $30 million, with the full amount of cost synergies being realized by the end of 2021.

Strengthens balance sheet: Pacific Drilling will be acquired on a debt free basis and with approximately $30 million of anticipated cash and cash equivalents, after adjusting for certain anticipated transaction related expenses. Noble remains committed to maintaining a conservative balance sheet.

Noble – Customer Focused, Global Provider of High-Specification Rigs
 

Pro forma for the acquisition, Noble will own and operate a high specification fleet of 24 rigs, with 11 drillships, 1 semisubmersible, and 12 jackups. Additionally, Noble will have pro forma backlog of approximately $1.7 billion, split across a diverse set of customers and regions of operation. Noble remains focused on serving the needs of its customers and delivering best-in-class operational excellence that is consistent across all geographies.

No changes to Noble's Board of Directors or executive management team are anticipated as a result of the acquisition.  Noble will continue to have its principal executive offices in Sugar Land, Texas.

Source: Noble

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