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Commenting on the news that offshore driller Ensco will buy Rowan in a $2.38 billion deal, Leslie Cook, principal analyst, Wood Mackenzie, said: "As we have been saying for the past two years, consolidation among drillers is paramount to a recovery. In that respect, this announcement comes as no surprise.
"Ensco and Rowan are companies that have strong brand recognition in both the jack-up and floater sectors.
"What makes a company like Rowan particularly interesting for Ensco is the opportunity to further high-grade their growing portfolio with premium assets and expand their footprint in key markets such as Middle East, Latin America, Europe and US Gulf of Mexico.
"Once combined, Ensco-Rowan will have the second-largest floating rig fleet, with nearly 90% consisting of generation VI and VII assets. These are the rigs that are most desired by operators globally, as they offer the best capabilities and flexibilities for various deepwater drilling programmes around the world.
"The combined company will also become the largest player in the jack-up sector. Nearly 40% of the combined portfolio will consist of ultra-harsh and modern harsh-environment assets."
Ms Cook added: "This is an excellent value for the shareholders of both companies."