Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of offshore driller Pride International (NYSE: PDE) soared as much as 18% in intraday trading Monday on heavy trading volume.

So what: Fellow driller Ensco (NYSE: ESV) announced that it's buying Pride for $7.3 billion in cash and stock. Pride shareholders will receive 0.4778 shares of Ensco stock and $15.60 in cash for each share of Pride that they own. That initially valued Pride shares at $41.60, but the decline in Ensco's stock today has trimmed the premium a bit. The transaction will create the world's second largest offshore driller behind Transocean.

Now what: After the jump in Pride's stock and the dip in Ensco's, there's not much more room for Pride's shares to climb to reach the deal price. That doesn't necessarily mean that Pride shareholders should take their gains and ride off into the sunset, though. The combined company will throw around considerable weight in the industry, and Ensco sees at least $50 million in annual expense savings from the deal. That could make it worth Pride shareholders' while to hang onto the Ensco shares coming their way when the deal closes.

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