Ensco Rowan plc announced the completion yesterday of the previously disclosed merger of Ensco plc and Rowan Companies plc. The company began trading today on the New York Stock Exchange under the ticker symbol ESV. EnscoRowan will maintain its headquarters in London with a significant presence in Houston.
Under the terms of the agreement, Rowan shareholders received 2.75 Ensco shares for each Rowan share they owned immediately prior to closing. Legacy Ensco and Rowan shareholders own approximately 55% and 45%, respectively, of the outstanding shares of EnscoRowan. Following the closing of the transaction, ordinary shares of the combined company were consolidated through a 4:1 reverse stock split, resulting in approximately 197 million ordinary shares outstanding.
“The successful completion of our merger further enhances our market leadership with a fleet of high-specification floaters and jackups and diverse customer base,” Tom Burke, EnscoRowan’s president and CEO, said in a statement. “Our growing geographic presence, technologically-advanced drilling rigs and talented employees position us exceptionally well to meet increasing and evolving customer demand. I look forward to executing on the significant long-term growth opportunities we believe we can capture from our combined strengths as the offshore sector recovers.”
“The combination of Ensco and Rowan creates an industry-leading offshore driller across all water depths, establishing a stronger company capable of thriving throughout the market cycles,” Carl Trowell, EnscoRowan’s executive chairman, said in a statement. “Our increased scale, diversification and financial strength will provide significant advantages to better serve our customers and unlock long-term value for our shareholders. We are excited to move forward together as a combined company.”
In conjunction with the closing of the transaction and the termination of the Rowan revolving credit facilities, the company has executed an agreement with its banking group to increase the capacity under its revolving credit facility. As a result, EnscoRowan will have a borrowing capacity under its unsecured revolving credit facility of approximately $2.3 billion through September 2019, and approximately $1.7 billion from October 2019 through September 2022.
Jon Baksht, EnscoRowan’s senior vice president and chief financial officer, said, the company was “pleased with the support of our banking group and their recognition of the strengthened position of the company following the closing of the merger. We will have one of the strongest liquidity positions in the offshore drilling sector, giving us a competitive advantage as we move forward as a combined company.”
EnscoRowan was formed by the combination of two leading offshore drillers with decades of experience to create a capable, effective and high performing offshore drilling service company. The company’s diverse rig fleet of ultra-deepwater drillships, versatile semisubmersibles and modern shallow-water jackups enables the company to provide drilling services across all water depths with unmatched scale, geographic presence and customer relationships, the company said.