Saudi Arabia’s TAQA to acquire Schlumberger’s rigs in Middle East

Arabian Drilling Company (ADC), the drilling subsidiary of Saudi Arabia’s Industrialization and Energy Services Company (TAQA), is set to acquire Schlumberger’s Middle East onshore drilling rigs business for $415m.

The transaction includes Schlumberger’s drilling business in Kuwait, Oman, Iraq and Pakistan.

Following the transaction, ADC’s portfolio will increase to a fleet of 58 onshore rigs and nine offshore rigs across the Middle East and North Africa.

The deal will also bolster the combined firm’s employee strength to 5,900 staff.

Aligned with TAQA’s growth strategy, the acquisition is expected to result in economies of scale and cost synergies, as well as enhance ADC’s regional footprint.

Established in 1964, ADC is a limited liability partnership between TAQA, which holds a 51% stake. Schlumberger owns the remaining 49%.

TAQA CEO and ADC board chairman Azzam Shalabi said: “This acquisition is fully aligned with Saudi Vision 2030. It unlocks value and drives growth across our entire value chain through a more integrated regional approach while positioning a leading Saudi company as a global player.

“This new combination clearly demonstrates that TAQA and ADC are delivering on their transformation and growth strategies, and further strengthens what is already a long-standing and trusted partnership between TAQA and Schlumberger.”

He also added that the acquisition follows the expansion of ADC last year when 16 rigs were commissioned to support Saudi Aramco’s operations.

Subject to regulatory approvals, the latest acquisition is expected to close in the second half of this year.

On the deal, Moelis & Company was the financial adviser to TAQA while Rothschild & Co. advised Schlumberger.