A UK-incorporated holding company – Noble Corporation plc (Topco) – has been set up for the purpose of completing the transaction, which could create an industry giant valued at up to $3.4 billion, according to analyst estimates.
The drilling firms announced plans to merge in November, though progress has been waylaid following a UK competition investigation into whether this will impact goods and services in the North Sea market.
In response, Noble and Maersk signed a $375 million deal to sell-off several units to a new subsidiary of Dubai-based Shelf Drilling to address the watchdog’s concerns.
Today both companies published documents outlining the merger process and its expected timeline, with Topco announcing its intention to submit a voluntary public share exchange offer in accordance with Danish takeover rules.
In exchange for each Maersk Drilling share of nominally DKK 10, Noble will offer 1.6137 Topco shares, with a nominal value of $0.00001 per share.
In addition to the share consideration, Topco will offer each Maersk shareholder who accepts the offer the opportunity to receive a cash consideration in lieu of certain Topco shares, subject to an aggregate cap of $50 million. This will be payable in Danish krone, translated from US dollars.
The combined company will be named Noble Corporation plc, and all its shares will be listed on the New York Stock Exchange and admitted to trading and official listing on Nasdaq Copenhagen.
The period for shareholders to accept the offer begins on 10 August and is expected to close at 23:59 CEST on 8 September.
If the deal is accepted, the exchange would be completed on 3 October, with Topco shares listed and trading on Nasdaq Copenhagen on the same date. The listing on NYSE is expected to take place “on or about” 30 September 2022.
Completion of the deal still relies on approval from the UK Competition and Markets Authority, however the watchdog’s most recent update on the deal suggested the sale of the Noble jack-up rigs to a new unit of Shelf Drilling offered a “clear cut” remedy to its concerns.
Maersk Drilling’s board has unanimously recommended that shareholders accept the offer and observe the timeline.
Key shareholders APMH Invest – which holds approximately 42% of Maersk Drilling’s total share capital and voting rights – has already accepted the offer, while A.P. Møller og Hustru Chastine Mc-Kinney Møllers Familiefond and Den A.P. Møllerske Støttefond – holding approximately 12% of total share capital and voting rights – have expressed their intention to accept.
Maersk Drilling’s chairman, Claus V. Hemmingsen, said: “The combination with Noble carries strong industry logic. Together we are creating a differentiated provider of offshore drilling services, which will be able to enhance the customer experience through increased scale, global reach, and industry-leading innovation.
“The combination will create value for all shareholders and will offer investors a unique opportunity to benefit from the market recovery, a robust financial position and strong free cash flow potential, all paving the way for the potential return of capital to shareholders.”
Noble’s president and CEO, Robert W. Eifler, added: “The combination of Noble and Maersk Drilling will create a dynamic leader in offshore drilling. Together, we will have the enhanced scale and capabilities to better serve our global customers and deliver long-term value to shareholders. I am pleased to have entered this stage of the process and look forward to closing the transaction later this year.”