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LONDON — Offshore drilling contractor Noble Corp. PLC announced on Monday its plans to acquire Diamond Offshore Drilling Inc. in a cash and stock transaction valued at approximately $1.6 billion.

Under the definitive merger agreement, shareholders of Texas-based Diamond Offshore will receive 0.2316 shares of Noble plus $5.65 in cash for each share they hold. The offer implies a value of $15.52 per share, representing an 11.4% premium on Diamond's closing price of $13.93 on the New York Stock Exchange on Friday. Once the transaction is completed, Diamond's shareholders will own 14.5% of the combined entity.

Paul Weiss Rifkind Wharton & Garrison LLP is serving as legal advisor to Noble, while Kirkland & Ellis LLP is advising Diamond.

The acquisition will extend Noble's fleet to 41 rigs, enhancing its customer base and geographic reach. Noble President and CEO Robert Eifler emphasized the strategic value of the acquisition, stating, "This acquisition enables Noble to continue our journey of delivering superior innovation and value to a broad range of the leading offshore operators across the world."

To finance the $600 million cash portion of the deal, Noble will use a bridge loan. The expanded company's board of directors will include a member from Diamond's current board.

Expected to close by March 2025, the deal requires regulatory approval and the backing of Diamond's shareholders. Specific regulatory authorities involved were not disclosed.

Diamond's board of directors has given the acquisition the green light. Diamond President and CEO Bernie Wolford highlighted the benefits to shareholders, saying, "This combination is an ideal outcome that provides Diamond shareholders both immediate and long-term upside potential."

Morgan Stanley & Co. LLC is acting as lead financial advisor to Noble, with Wells Fargo and SpareBank 1 Markets also providing advisory services. Guggenheim Securities LLC and TPH&Co., the energy business of Perella Weinberg Partners, are serving as lead financial advisors to Diamond.

The acquisition is poised to strengthen Noble's position in the offshore drilling market, leveraging Diamond's assets and expertise to drive growth and innovation in the sector.