OSLO (Bloomberg) — Bermuda-based Seadrill Ltd., the Norwegian oil-rig company set up by billionaire John Fredriksen, said it ordered four new rigs worth $850 million that represent a better investment than an increased bid for Houston-based Scorpion Offshore.

The jack-up rigs, the most common type for drilling in shallow water, will be built at Singapore's KFELS and PPL shipyards and delivered in 2010, Seadrill said in a statement yesterday.

"The Seadrill board has specifically concluded that this opportunity is superior to increasing the bid for Scorpion in order to achieve a potential higher acceptance," chief executive officer Alf Thorkildsen said in the statement.

Seadrill said in April it will buy 36 percent of Scorpion for 80 kroner a share, valuing the company at 4.3 billion kroner ($839 million), and make a mandatory offer for the remaining shares. Scorpion said on June 2 the offer didn't reflect the company's "true value".

Scorpion has two jack-up rigs and five under construction that are scheduled to be delivered by the end of 2009. Jack-up rigs have retractable legs that extend to the seafloor.

"These new-build orders are the best way to increase Seadrill's near-term earnings potential," Thorkildsen said. "We are convinced that the market for offshore drilling units in general will remain tight in the years to come."