Noble Corp. Acquires Frontier, Inks Deal With Shell (NE, RDS.A)

Noble Corp. NE has announced that it is acquiring privately held drilling company FDR Holdings Ltd., also known as Frontier, in a deal valued at $2.16 billion. Noble (NE) also signed new contracts with Royal Dutch Shell RDS. The Frontier deal is expected to immediately boost NE's cash flow and contribute to the bottom line starting in 2011. The company will acquire six floating drilling units and add about $2 billion to its contract backlog. The agreement with Shell (RDS.A), Noble signed 10-year contracts for two ultra-deepwater drillships and an extension on a ship which is already active in the Gulf of Mexico. "This acquisition is a highly complementary extension of our mid- and deepwater presence and positions us for additional growth in new market segments that can provide further opportunities for Noble and our customers," Noble Chief Executive David Williams said in a statement. During today's trading session, NE has gained 4.61% to $30.63 as investors have reacted positively to today's announcement.