By David French
(Reuters) – Noble Corp and a consortium that includes Transocean Ltd and Dolphin Drilling are competing to acquire the assets of Seadrill Ltd, the bankrupt offshore oil driller controlled by Norwegian-born tycoon John Fredriksen, people familiar with the matter said on Tuesday.
Seadrill is trying to emerge from its second U.S. Chapter 11 bankruptcy in four years: like many in the industry, it expanded its drilling rigs too aggressively in the mid-2010s to withstand a subsequent plunge in energy prices and rig hire rates. It is negotiating a deal to restructure its more than $7 billion debt pile in exchange for handing company control to its creditors.
U.S. Chapter 11 bankruptcy proceedings temporarily shield companies from creditor claims, allowing firms to maintain operations while providing time to agree on debt restructuring plans, which must in turn be approved by a court.
Any acquisition offer would have to provide more value to the creditors involved than the restructuring plan under negotiation. For buyers, acting now means they could scoop up all Seadrill’s assets without taking on any of its debt pile.
The consortium comprising Transocean, Dolphin Drilling and a third party, whose identity could not be learned, lodged a bid for Seadrill in early-July, the sources said.