SUGAR LAND, Texas and COPENHAGEN, Denmark – Noble Corp. and Maersk Drilling have issued an update on the ongoing merger control process for the business combination announced on Nov. 10, 2021.
On April 22, 2022, the UK Competition and Markets Authority (UK CMA) announced its Phase 1 decision, pursuant to which it concluded that the proposed merger gives rise to a realistic prospect of a substantial lessening of competition in relation to the supply of jackup rigs in North West Europe (excluding Norway), and that a remedy to address such effect would be required to avoid a reference to a Phase 2 review.
On April 29, 2022, the two companies submitted remedy proposals to the UK CMA (the “Remedy Proposals,” and individually a “Remedy Proposal”) to address such effect identified in the UK CMA’s decision of April 22, 2022. Each of the remedy proposals was designed to replicate the competitive constraint provided by Noble in respect of jackup rigs in NW Europe by the divestment of certain jack-up rigs to a suitable purchaser.
On May 9, 2022, the UK CMA published its decision that there are reasonable grounds for believing that one of these Remedy Proposals might be accepted. This one Remedy Proposal comprises the divestment of the rigs Noble Hans Deul, Noble Sam Hartley, Noble Sam Turner, Noble Houston Colbert, and Noble Lloyd Noble (the “Remedy Rigs”) including all of the related support and infrastructure that the purchaser will need to run the Remedy Rigs as an effective standalone business. Relevant offshore and onshore staff are expected to transfer with the Remedy Rigs.
On this basis, the companies say they will seek to reach an agreement with a potential purchaser regarding the sale of the Remedy Rigs under the Remedy Proposal. The UK CMA will need to consider the purchaser a suitable purchaser.
Following its decision that it might accept this Remedy Proposal, the UK CMA will review the terms of the Remedy Proposal and the suitability of potential purchasers. This will include seeking third-party comment. The duration and outcome of the UK CMA review process remains uncertain. If a Remedy Proposal is accepted by the UK CMA, closing of the transaction is expected to occur in mid-2022.