Transocean (Sell, TP: USD8.00) - Good for the industry
We believe the main benefit of Transocean’s proposed acquisition of Ocean Rig is that it is the first step towards a further consolidated UDW market. We maintain our initial view that the deal is a good strategic fit, but dilutive on most metrics. On asset values, we estimate dilution of cUSD0.7 per Transocean share, as reflected in yesterday’s -7% share price reaction. We reiterate our SELL and USD8 target price.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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