Oil: Noble to acquire Diamond Offshore Drilling in $1.6B deal

In the offshore oil drilling sphere, Noble Corporation (NE) announced an agreement to acquire Diamond Offshore Drilling (DO) in a cash-and-stock deal valued at $1.6 billion. Yahoo Finance's Ines Ferré comments on the consolidation trends in the energy sector.

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This post was written by Luke Carberry Mogan.

Video transcript

Stick with the energy industry.

There's a merger again merger Monday in the energy sector Offshore rig contractor Noble set to buy smaller rival Diamond Offshore drilling What can you tell us about this latest consolidation?

Yeah, So this was expected in the sense that now smaller players within the energy space are expected to be consolidating after we saw that wave of those bigger players.

Well, Noble is the world's biggest offshore oil drill contractor.

And because the Permian Basin is maturing now you have producers that are looking for oil elsewhere, namely offshore.

And so this is sort of expected in a sense, that the industry is moving towards now looking for these larger plays elsewhere.

With this consolidation, Noble had talked about gaining some assets, but down in in Brazil.

So this is something that they'll be adding some scale in those places like Brazil.

So this is something that is expected in the sense that now you've got the the smaller deals $1.6 billion for this deal.

It's not as big as some of the other ones that we've seen in recent months,