DealZone

Noble Corp’s $2.16 billion deal to buy privately held Norwegian driller Frontier was called “reasonably priced” by one analyst and the market welcomed the acquisition, pushing shares of the U.S. offshore rig contractor slightly higher. The all-cash deal will be funded by a combination of existing cash, drawing down on its bank credit facility and an $800 million bridge loan facility.

“Makes sense, reasonably priced, doesn’t stretch balance sheet, tightens Shell relationship, provides deepwater contract visibility,” said research from analysts at Tudor Pickering Holt. Noble also said it signed 10-year contracts for two ultra deepwater drillships and a multi-year extension on a semi-submersible with Royal Dutch Shell.

How has the deal been colored by the massive BP oil spill and the subsequent gulf drilling moratorium? Noble has lowered its dayrate for the drilling rig that Frontier has operated for Shell in the Gulf, but the size of that reduction is not yet clear. If nothing else, investors may take comfort that the disaster is not keeping deals from getting done, and may even be nudging some along.