Atwood Oceanics — Merger or Acquisition (September 2017)
25 slides from Atwood Oceanics's merger presentation, Sep 6, 2017
Slide 1: Forward-Looking Statements
Forward-Looking Statements Statements included in this presentation regarding the proposed transaction, benefits, expected synergies and other expense savings and operational and administrative efficiencies, opportunities, timing, expense and effects of the transaction, financial performance, accret
Slide 2: Participants in the Solicitation
Participants in the Solicitation Ensco and Atwood and their respective directors, executive officers and certain other members of management may be deemed to be participants in the solicitation of proxies from their respective security holders with respect to the transaction. Information about these
Slide 3: Market Cycle & Insights / Atwood Acquisition / Value Proposition
Market Cycle & Insights Atwood Acquisition Value Proposition
Slide 4: Value Proposition
Value Proposition Ideal Platform For Optimizing Offshore Drilling Assets Broad Global Footprint with Diverse Customer Base Solid Financial Position High-Quality Rig Fleet Safety & Operational Excellence Systems, Processes & Intellectual Property
Slide 5: Safety & Operational Excellence
Safety & Operational Excellence Critical to customers, in particular for complex well programs Safety metrics consistently better than industry averages Improved safety and operational results each successive year during industry downturn 1% improvement in operational utilization increases annual re
Slide 6: Systems, Processes & Intellectual Property
Systems, Processes & Intellectual Property 1Includes provisional and non-provisional patent filings completed or in progress since 1Q15 improvement in subsea equipment-related downtime during 2016 patent filings since 20151 25 Intellectual Property Systems & Processes 80% Technology and Innovation I
Slide 7: High-Quality Rig Fleet
High-Quality Rig Fleet Diverse Fleet Capable of Meeting a Broad Spectrum of Customers’ Well Program Requirements Ultra-Deepwater Drillships Versatile Semisubmersibles Premium Jackups Note: Includes rigs under construction, excludes managed rigs and rigs announced for retirement Total Rigs: 12 8 31
Slide 8: Broad Global Footprint with Diverse Customer Base
North Sea Broad Global Footprint with Diverse Customer Base Mediterranean Note: Certain customers may not currently be under contract Customer Base Spans Majors, National Oil Companies and Independents West Africa Middle East Southeast Asia Gulf of Mexico Brazil Australia
Slide 9: Solid Financial Position
Solid Financial Position Financial Position – 30 June 2017 $4.1 billion of liquidity $1.85 billion of cash and short-term investments $2.25 billion revolving credit facility $3.3 billion of contract revenue backlog $2.9 billion of net debt & 26% net debt-to-capital ratio BB/B1 credit ratings No secu
Slide 10: Atwood Acquisition Value Proposition Market Cycle & Insights
Atwood Acquisition Value Proposition Market Cycle & Insights
Slide 11: Commodity Prices Have Recovered to Levels Above Some Offshore Project Breakevens
Commodity Prices Have Recovered to Levels Above Some Offshore Project Breakevens Commodity Price Source: FactSet; Statoil 7 February 2017 Capital Markets Day; Repsol 23 February 2017 earnings conference call; Chevron 29 April 2016 earnings conference call; Petrobras CEO Pedro Parente via Bloomberg 1
Slide 12: Global Utilization Has Stabilized as Commodity Prices Improved
Jackup + Floater Utilization Global Utilization Has Stabilized as Commodity Prices and Project Economics Have Improved Global utilization appears to have bottomed in late 2016 and has increased modestly during 2017 Customers are awarding more work to major offshore drillers with established safety &
Slide 13: Further Supply Rationalization Expected to Improve Supply/Demand Dynamics
Further Supply Rationalization Expected to Improve Supply/Demand Dynamics Source: IHS Markit RigPoint as of August 2017 Excludes rigs classified as non-competitive by HIS, mat and slot jackups, rigs located in the Caspian and Baltic regions and owner-operated rigs. Newbuilds include rigs with delive
Slide 14: Customers Prefer High-Specification Assets Operated by Established Drillers
Customers Prefer High-Specification Assets That Are Operated by Established Drillers As market conditions improve, high-specification rigs and established well-capitalized offshore drillers are winning a greater number of new contracts Project sanctioning this year has already exceeded 2016 levels A
Slide 15: Higher Customer Activity Has Led to Increased Contract Awards
Higher Levels of Customer Activity Have Led to Increased Contract Awards New contracts have added more than 20 rig years2 to Ensco’s backlog Diverse rig fleet and global footprint have led to floater and jackup contracts across several regions Won nearly 20% of all deepwater contracts year to date F
Slide 16: New Contracts Provide Greater Visibility Into Drillship Utilization
New Contracts Provide Greater Visibility Into Marketed Drillship1 Utilization 2017 2018 2019 2020 Available ENSCO DS-4 Two-year contract offshore Nigeria One 1-year option ENSCO DS-10 One-year contract offshore Nigeria Five 1-year options ENSCO DS-7 Six-well contract in the Mediterranean Four 1-well
Slide 17: Market Cycle & Insights Value Proposition Atwood Acquisition
Market Cycle & Insights Value Proposition Atwood Acquisition
Slide 18: A Compelling Transaction for Shareholders
A Compelling Transaction for Shareholders Acquisition of best-in-class assets improves Ensco fleet High-grades portfolio of floaters and jackups Contracting opportunities for high-specification assets in current market Terms of acquisition and timing are advantageous Accretive to shareholder value C
Slide 19: Acquisition Renews Fleet and Enhances Capabilities
Acquisition Renews Fleet and Enhances Capabilities Source: IHS ODS-Petrodata, Company Analysis 1 Drillships capable of operating in at least 10,000’ of water with dual 2.5 million lb. hookload derricks, dual 7 Ram blowout preventers and variable deck loads exceeding 22,000 tons Best-In-Class1 Drills
Slide 20: Purchase Price Reflects Attractive Implied Per-Floater Valuation
Purchase Price Reflects Attractive Implied Per-Floater Valuation Unique Opportunity To Acquire Multiple Offshore Assets At Significant Discount To Market Values Source: Company Filings, Morgan Stanley Equity Research, Capital IQ 1 “At offer” data as of May 26, 2017, ATW Offer Equity Value of $897MM
Slide 21: Synergies Create Meaningful Value
Synergies Create Meaningful Value Source: Company Analysis $70MM of annual run-rate expense synergies expected beginning in 2019 2018 cost synergies are projected to exceed $50MM Total synergies estimated to create more than $500MM of present value at a 10% discount rate ~$350MM will accrue to ESV s
Slide 22: Manageable Debt Maturities in Light of Strong Balance Sheet & Liquidity
Manageable Debt Maturities in Light of Strong Balance Sheet & Liquidity $300 $ millions $1,001 $150 $1,805 $2,250 Available Revolver 1 2 3 Cash & ST Inv. $3,271 ESV Convertible Senior Notes ESV Senior Notes <$1.0B of Maturities3 to 2024 1 Pro Forma balance sheet highlights as of June 30, 2017, after
Slide 23: The Offshore Driller of Choice
The Offshore Driller of Choice Strengths create an ideal platform for optimizing offshore drilling assets Safety & operational track record Systems, processes & intellectual property High-quality rig fleet Broad global footprint with diverse customer base Solid financial position Leader in new contr
Slide 24: The Offshore Driller of Choice
ENSCcO —~p The Offshore Driller of Choice v Strengths create an ideal platform for optimizing offshore drilling assets ~ Safety & operational track record ~ Systems, processes & intellectual property — High-quality rig fleet — Broad global footprint with diverse customer base ~ Solid financial posit
Slide 25: Ensco - Go Beyond
ENSCO > | Go Beyond
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