Seadrill...

Seadrill (SDRL.OL) is looking to consolidate the industry. This is no surprise. But now, with an almost $9 billion market cap and no debt as yet, they can buy anyone they want except Transocean (RIG), which is too big.

Let's analyze the industry players according to:

enterprise value
operating income

A lower value means a cheaper valuation, i.e., a more profitable takeover candidate.

The second thing to consider is the number and type of rig these companies own and have under construction. Seadrill is concentrating on deepwater, state of the art rigs that can drill in harsh conditions. For simplification purposes, I will value any rig that can drill in depths of 5000 feet or more at $1 billion.

Global Santa Fe (GSF):
EV/OI=16.5 6 deepwater rigs (5000'+) market cap: 14.92 bil.
Diamond Offshore (DO):
EV/OI=15.0 9 deepwater rigs (5000'+) market cap: 10.61 bil.
Noble Corp. (NE):
EV/OI=12.9 12 deepwater rigs (5000'+) market cap: 11.05 bil.
Ensco International (ESV):
EV/OI=11.6 4 deepwater rigs (5000'+) market cap: 8.19 bil.
Transocean (RIG):
EV/OI=27.2 33 deepwater rigs (5000'+) market cap: 23.96 bil.

The most likely takeover candidates are Noble and Diamond Offshore.