Eldorado Drilling Acquires Vantage Drilling International for $258 Million, Paying 60 Cents Per Dollar of $430.8 Million Deepwater Backlog

Norwegian independent drilling contractor Eldorado Drilling AS announced on May 29 that it will acquire Vantage Drilling International Ltd for $19.00 per share in cash. The transaction values Vantage's equity at $257.6 million. Shareholders will vote on June 18, 2026, and the deal is expected to close by July 31.

A Five-Drillship Offshore Fleet

Eldorado was founded in 2022 and operates three 7th-generation ultra-deepwater drillships built by Samsung Heavy Industries: the Dorado, Draco, and Zonda. In February 2026, the company also acquired the Deep Value Driller for $300 million, bringing its fleet to four ultra-deepwater vessels. Chief Executive Neil Hall, who previously served as Senior Vice President of Worldwide Operations at Diamond Offshore, leads Eldorado from offices in Norway and Malta.

Vantage brings a sixth-generation ultra-deepwater drillship, the Platinum Explorer, plus four Baker Marine Pacific Class 375 ultra-premium jackup rigs. The combined entity will operate five ultra-deepwater drillships and four jackup rigs. Vantage trades on Euronext Growth Oslo and will delist on deal close, becoming a wholly owned subsidiary of Eldorado.

Derived Calculation: 60 Cents Per Dollar of Contracted Revenue

Vantage reported a contract backlog of $430.8 million at the end of Q1 2026, per its May 26 earnings release. At the $257.6 million equity deal price, Eldorado pays approximately 60 cents for every dollar of Vantage's contracted backlog, assuming no net indebtedness at close, which the merger agreement requires. That calculation excludes the four jackup rigs, the operating platform, and any future contract wins beyond the existing backlog.

The Platinum Explorer anchors that backlog. India's Oil and Natural Gas Corporation awarded the vessel a three-year firm contract in February 2026, valued at $261 million excluding managed pressure drilling services. At $261 million over 1,095 contracted days, the implied day rate is approximately $238,000 per day. Vantage management stated on the Q1 2026 earnings call that ultra-deepwater utilization is projected to remain above 90 percent through 2027.

Deal Financing and Corporate Structure

Eldorado's principal shareholder committed $125 million in equity support: $64.5 million in new cash and $60.5 million converted from existing shareholder notes. Eldorado will also issue approximately $425 million in new senior secured bonds to fund the acquisition and refinance the combined entity's debt. Concurrent with the merger, Eldorado will reorganize under a new Cayman Islands parent company, referred to as New Eldorado, which will assume substantially all assets and liabilities.

Baker Botts LLP advised Eldorado on both the Vantage acquisition and the parallel corporate reorganization. Vantage's board unanimously approved the transaction and recommended shareholders accept the $19.00 per share offer. Dissenting Vantage shareholders cannot exceed 10 percent of outstanding shares without triggering deal conditions under Bermuda law. The merger agreement requires no net indebtedness in Vantage at closing.

Vantage's Decade of Recovery

Vantage has rebuilt from a $2.6 billion Chapter 11 restructuring. The company filed a prepackaged plan in December 2015, restructuring that debt load, and emerged from bankruptcy in February 2016 as the offshore drilling downturn cut ultra-deepwater day rates below $100,000 on many contracts. Q1 2026 revenue reached $47.2 million, a 48 percent increase over Q1 2025, with revenue efficiency of 98.5 percent across its managed fleet. The $19.00 per share price represents an exit for shareholders who held through that full recovery cycle.

Eldorado moved on an aggressive acquisition timeline. After building its three Samsung drillships from formation in 2022, the company paid $300 million for the Deep Value Driller in February and now commits $257.6 million for Vantage five months later. WTI crude settled at $87.36 per barrel on Friday's CME close, a price that keeps ultra-deepwater project economics above breakeven for most operators. The $425 million bond issuance will rank among the largest single debt raises in the independent offshore drilling segment in 2026.