According to reports, offshore drilling contractor Seadrill is in discussions with its larger counterpart Transocean regarding a potential merger.
According to reports, the financial news app Zhitong Finance has learned that offshore drilling contractor Seadrill (SDRL.US) is in discussions with its larger counterpart Transocean (RIG.US) regarding a potential merger.
Reports suggest that merging with Seadrill would align with Transocean's strategic goal to increase backlog, utilizing some of the world's most advanced drilling platforms capable of drilling in waters deeper than two miles.
It is understood that these two companies were once the world's two largest offshore drilling companies, but due to the long-term downturn in the industry, many contractors were forced to go bankrupt, leaving both companies lagging behind. With oil prices stabilizing and the growth of USA shale oil fields slowing down, offshore drilling, especially deepwater drilling, is once again thriving.
Transocean's stock price has fallen by 35% year-to-date, with a market cap of 3.6 billion USD, while Seadrill's stock price has dropped by 26% since the beginning of the year, with a market cap of 2.4 billion USD.