Ensco and Rowan Cos. to combine in deal with enterprise value of $12 billion
Ensco Plc and Rowan Companies Plc said Monday they have agreed to combine in an all-stock deal with an enterprise value of $12 billion. Under the terms of the deal, Rowan shareholders will receive 2.215 Ensco shares for each Rowan share. The combined company expects to achieve annual pretax synergies of about $150 million. The deal is expected to boost cash flow per share in 2020 and to close in the first half of 2019. The new company will be a leading player in offshore drilling with a diverse customer base that includes most of the big offshore reserve holders, the companies said in a joint statement. Rowan Chief Executive Tom Burke will serve as CEO of the new company. “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,” Burke said in a statement. Ensco shares rose 2.7% premarket on the news, while Rowan shares were up 2.8%. S&P 500 futures were down 0.3%.