HOUSTON (Reuters) — Bermuda-registered oil driller SeaDrill Ltd. is in ongoing deal talks with US drillers GlobalSantaFe Corp., Ensco International Inc. , Noble Corp. and Transocean Inc., Lehman Brothers said yesterday in a weekly note to clients.SeaDrill, which operates mobile drilling fleets specialising in deepwater and harsh environments and has about 5,000 employees, is willing to pay cash and will pay a premium, but will not do a hostile deal, Lehman said in the note.

Lehman cautioned that “the likelihood that a deal is done is still only 40 percent”.

Lehman analysts reported the talks after meeting with Tor Olav Troim, a director and vice president at SeaDrill, which is owned by Norwegian oil tanker magnate John Frederiksen.

“SeaDrill wants to do a transaction with a US company, however believes it will still be difficult to achieve and reach mutually agreeable terms,” Lehman wrote.

The Norwegian company told Lehman it believes a sale-lease back of its own assets or leveraged recapitalisation is a more likely outcome, according to the note.

When asked about the talks, Seadrill’s chief executive officer Kjell E. Jacobsen said he could not comment.

Representatives for GlobalSantaFe and Ensco could not be reached immediately for comment. Spokesmen for Transocean and Noble said it is company policy not to comment on speculation.

SeaDrill is often touted as a potential suitor for US-based offshore drillers. In January, it hired Tim Juran, a former executive at Transocean, to head its operations in North and South America. That appointment fueled more talk that the Norwegian company was on the prowl for a US driller.

GlobalSantaFe shares were up eight cents at $58.51, Ensco edged up 2 cents to $51.22, Transocean shares were off nine cents at $76.53, and Noble shares fell 30 cents to $73.86. All trade on the New York Stock Exchange.

SeaDrill in merger talks