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Seadrill in $958 million acquisition of Aquadrill

Posted on January 3, 2023

Aquadrill (the former Seadrill Partners) has a fleet that includes four drillships

Offshore drilling contractors Seadrill Limited (NYSE & OSE: SDRL) and Aquadrill LLC have entered into a definitive merger agreement that will see Seadrill acquire Aquadrill in an all-stock transaction.

On completion of the transaction Seadrill shareholders and Aquadrill unitholders will own 62% and 38%, respectively, of the outstanding common shares in the Company. The transaction values Aquadrill at an implied equity value of approximately $958 million, based on Seadrill’s 30-day volume-weighted average share price on the NYSE of $31.25 as of December 22, 2022.

Reading, U.K., headquartered Aquadrill, which emerged from Chapter 11 restructuring in on May 24, 2021, is the former Seadrill Partners and owns a fleet of eight offshore drilling units: four ultra-deepwater drillships, one ultra-deepwater semi-submersible and three tender assist drilling units.

Commenting on the transaction, Simon Johnson, Seadrill’s president and CEO said, “At Seadrill we seek to deliver safe and effective operations as the bedrock for generating returns for our shareholders. Seadrill and Aquadrill have a long and rich strategic and operational management history. Our shared heritage will promote efficient integration of the two companies. I look forward to welcoming the Aquadrill fleet back into the Seadrill family.”

Steven Newman, Aquadrill’s Chief Executive Officer, said, “We believe this combination will create the most value for our shareholders and will create an excellent platform for high quality service delivery to our customers.”

The transaction has been approved by the boards of both companies. The required approval of Aquadrill’s unitholders has also been obtained. The transaction does not require Seadrill shareholder approval.

Aquadrill unitholders and equity award holders will in aggregate receive 30,645,160 common shares of Seadrill, representing 38% ownership in the company, or approximately 36.6% on a fully-diluted basis. Following completion of the transaction, Aquadrill will become a wholly owned subsidiary of Seadrill.

Aquadrill unitholders who collectively own more than 75% of Aquadrill’s common units have agreed to approve the transaction. No further vote of Aquadrill unitholders is required in respect to the transaction. The transaction does not require Seadrill shareholder approval. The transaction is, however, subject to applicable regulatory approvals and other customary conditions, and is expected to close in mid 2023.

The company will remain named Seadrill Limited and will continue to be domiciled in Hamilton, Bermuda. Julie Robertson and Simon Johnson will continue in their respective roles as chair of the board of directors, and president and chief executive officer.


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