Seadrill has paid NOK 461 million for a 50.1 percent majority stake in deepwater drilling contractor Sevan Drilling today. This acquisition exceeds the mandatory offer threshold and will now lead to a bid by Seadrill for the remaining shares.
According to the Norwegian Securities Trading Act, this offer must be made within four weeks of today, 27 June.
The board of Sevan Drilling however, does not appear too excited about the offer.
In a statement today, they comment that the price of NOK 3.95 “undervalues Sevan Drilling’s assets and prospects, and represents a significant discount to latest analyst consensus net asset value estimates and target prices.”
Seadrill has already announced their intention to call an extraordinary shareholders meeting to propose a new board reflecting its new level of ownership, management arrangements and an alternative financing plan.
Will there be a big shake up in Sevan’s Board after this acquisition? Looking at the biographies of their board members, it’s hard to say one way or another. Sevan Drilling’s Chairman Erling Lind is currently working as an external legal counsel for Seadrill, and board member Per Wulf is also Seadrill’s Chief Operating Officer.