Offshore drilling contractor Noble Corp. (NE) announced that it has changed the place of incorporation of its publicly traded parent company from Switzerland to the United Kingdom on Nov 20. The move is expected to slash its tax burden by half.
Noble's ordinary shares will continue to trade on the New York Stock Exchange under the current trading symbol "NE".
In September, the company announced plans to spin off half of its fleet into a separate entity to concentrate on its high-specification assets operating in deeper waters.
The new company would own and operate the majority of standard specification drilling units in the Noble fleet, comprising five drillships, three semisubmersibles, 34 jackups, two submersibles and one FPSO.
The separation is likely to involve an initial public offering (IPO) of about 20% of the new company’s shares in a tax-free distribution of the new stock to the existing Noble investors. In case of an IPO, Noble anticipates that the new company would file a registration statement with the U.S. Securities and Exchange Commission by early 2014.
Noble expects shareholders’ approval in the second quarter of 2014, while the spin-off is projected to be completed by the end of 2014.
A provider of diversified services for the oil and gas industry, Noble Corp. performs contract drilling services with a fleet of 76 mobile offshore drilling units (including seven ultra-deepwater rigs and four jackup drilling rigs currently under construction). It also provides labor contract drilling, engineering and consulting, and project management services. The company offers its services principally in the United States, the Middle East, India, Mexico, the North Sea, Brazil and West Africa.
Noble carries a Zacks Rank #3 (Hold). However, Zacks Ranked #1 (Strong Buy) stocks – SM Energy Company (SM), Matador Resources Company (MTDR) and Abraxas Petroleum Corp. (AXAS) – are good buying options for the short term.
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