UPDATE 2-Deal chatter continues to fuel Pride Int’l rally

* Q3 adj cont ops shr $0.33 vs est $0.28 — I/B/E/S * Q3 rev
falls 10 pct, misses Street

* Does not rule possibility of sale

* Sees Q4 shr of $0.38-$0.43

* Shares up as much as 6 pct
(Rewrites; adds conference call details, analyst comments)

BANGALORE, Nov 4 (BestGrowthStock) – Pride International Inc
(PDE.N: ), in the spotlight after reports that rivals had
approached to buy the deepwater driller, did not rule out the
possibility, sending its shares up for the second consecutive
day.

In a post-earnings conference call, the company, which gave
a weak fourth-quarter outlook, said: “We have always looked at
consolidation opportunities; all of our competitors look at
them.”

On Tuesday, Pride was cited in a media report as
considering alternatives including putting itself up for sale
after recent merger interest from rivals. Earlier that day, its
spinoff company Seahawk (HAWK.O: ) revealed its plans to explore
strategic alternatives, including a sale. [ID:nSGE6A20K9]

Some analysts have questioned Pride’s ability to achieve
its financial targets as a standalone entity.

Pride, which reported a strong third-quarter profit (Read more your timing to make a profit.),
forecast earnings of 38-43 cents a share for the fourth
quarter.

Analysts were expecting earnings of 52 cents a share,
according to Thomson Reuters I/B/E/S.

“I am curious to know how long this can go on without a
deal happening,” analyst Matthew Beeby of Global Hunter
Securities told Reuters.

Shares of Pride, which were flat in early trade, rose as
much as 6 percent to $34.36 on the New York Stock Exchange
after its comments in the conference call. They were trading at
$33.57 in the afternoon, in above-normal volumes.

The shares had closed up 4 percent on Wednesday, after
rising as much as 6 percent intraday.

The offshore oil drilling sector has long been seen as ripe
for consolidation. While the conditions created by the Gulf of
Mexico oil spill should accelerate deals, it has become tougher
for smaller drillers to compete. [ID:nN30218160]

With Pride’s assets, there are increasing chances of
consolidation sooner than expected, analyst Beeby said.

The company, with a fleet of 25 rigs, has operations in
West Africa, Latin America, Gulf of Mexico, the Middle East and
India, and has a market value of about $5.45 billion.

Pride’s July-September income from continuing operations
was $42.8 million, or 24 cents a share, compared with $79.9
million, or 45 cents a share, last year.

Excluding items, earnings from continuing operations were
33 cents a share, compared with analysts estimates of 28 cents
a share.
(Reporting by Thyagaraju Adinarayan in Bangalore; Editing by
Prem Udayabhanu, Unnikrishnan Nair)

UPDATE 2-Deal chatter continues to fuel Pride Int’l rally