In a deal with an enterprise value in excess of $12bn Rowan shareholders will receive 2.215 Ensco shares for each Rowan share with Ensco and Rowan shareholders owning approximately 60.5% and 39.5% of the merged company.
Ensco president and ceo Carl Trowell, who will serve as executive chairman of the combined company, while Rowan president and ceo Tom Burke, who will serve as president and ceo.
The merged company will have a fleet of 28 semi-submersible rigs and drillships, and 54 jack-up rigs serving more than 35 customers, including the largest national oil companies, international majors and independent exploration and production companies. The companies is aiming for $150m in synergy savings annually, with more than 75% in the first year.
Trowell said: “The combination of Ensco and Rowan will create an industry leader in offshore drilling across all water depths, with significant advantages to capitalize on future opportunities and better serve our customers.”
Burke added: “By merging our high-quality rig fleets and infrastructure covering the world’s most prolific offshore basins, we increase our scale while maintaining a shared focus on high-specification assets that will include ultra-deepwater drillships and versatile semisubmersibles, as well as harsh environment and modern jack-ups.”
The merged company will operate in the Gulf of Mexico, Brazil, West Africa, North Sea, Mediterranean, Middle East, Southeast Asia and Australia.
Saudi Aramco, Rowan’s joint venture partner in ARO Drilling has given its approval for the merger. “Ensco shareholders will uniquely benefit from Rowan’s strategic joint venture with Saudi Aramco, ARO Drilling,” Trowell said.
ARO Drilling has a 20-rig newbuild programme.