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Noble and Paragon

Sunday, 22 April 2018
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Advised Noble Corporation on its $10bn merger to set up Noble Corporation plc and on the $1bn demerger of Paragon Offshore plc from Noble.

Travers Smith was engaged by Noble Corporation, a Swiss-incorporated company listed on the NYSE, in late 2012.  Noble had a market capitalisation of approximately $10 billion and provides worldwide offshore contract drilling services for the oil and gas industry.  Baker Botts out of Houston/Dallas were the long-time US counsel to Noble and we were instructed, alongside Pestalozzi (Zurich), to structure and execute a cross-border merger of the Noble group with a new UK plc. This was completed in November 2013.  As part of the merger, Noble flagged to its shareholders that it was looking to then demerge its "standard specification" offshore delivery units by distributing its equity in that division to Noble's shareholders.  The demerger of Paragon Offshore PLC was completed on 1 August 2014: Paragon itself is also now listed on the NYSE.

The transaction involved a massive amount of coordination between Travers Smith, Baker Botts, Noble, Paragon, KPMG and PwC. The first stage of the transaction (the Noble Merger) broke new ground: Swiss statutory merger law does not gel with UK legislation and case law.  Working with Pestalozzi, we came up with an innovative merger structure that satisfied the Swiss merger rules yet still complied with English law parameters.  As this was unprecedented, the Swiss authorities required QC attestation of the legal effect of the structure.

Running in parallel with the corporate steps was a bond issue and raising of senior debt.  For much of the early stages of the demerger, it was also anticipated that Paragon would be raising additional equity funds by IPO on NYSE.  Travers Smith was required to coordinate all of the English law aspects of the transaction: as both Noble and Paragon were UK PLCs, this involved a significant degree of complexity. 

Both Noble and Paragon are relatively unusual in that they are UK-incorporated PLCs which are listed on the New York Stock Exchange.  This brings some interesting challenges in itself: much of the UK Companies Act regime for PLCs assumes that the company is quoted on the London Stock Exchange.  Travers Smith therefore needed to marry up the expectations of a predominately US investor base with the practicalities of the UK Companies Act to deliver corporate solutions in the structuring that gave the required flexibility.

Awarded Energy Deal of the Year at the M&A Advisor Dealmakers’ Awards 2014

Details of the deal
Size - US$10bn

Summary
Advised Noble Corporation on its $10bn merger to set up Noble Corporation plc and on the $1bn demerger of Paragon Offshore plc from Noble

Jurisdictions
United States, UK and Switzerland

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