Swiss driller Transocean snaps up Songa Offshore for $3.4 billion

Deepwater drilling major Transocean (NYSE:RIG) has agreed a deal to acquire Songa Offshore for nearly US$3.4 billion.

The company said the transaction strengthens Transocean’s position as the ‘undisputed leader in harsh environment and ultra-deepwater drilling’.

As well as increasing the firm’s contract backlog by $4.1 billion to $14.3 billion, the combined company will operate a fleet of 51 mobile offshore drilling units.

“Songa Offshore is an excellent strategic fit for Transocean,” said Jeremy Thigpen, Transocean president and CEO.

“Further enhancing our position in the harsh environment market. We also demonstrate our continued commitment to the Norwegian market and strengthen our technical and operational presence in that region.”

He added that bringing Songa’s existing contracts into the company adds more visibility for future cash flow in the challenging market and will create incremental value for customers and shareholders.

Songa Offshore chairman Frederik Wilhelm Mohn agreed that it was a strategic fit and added: “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 in this segment which is showing signs of recovery.”