Transocean Announces Pricing of Convertible Senior Notes Offering
HOUSTON--(BUSINESS WIRE)--Dec. 6, 2007--Transocean Inc. (NYSE:RIG)today announced that it priced a public offering of $2 billion of1.625% Series A Convertible Senior Notes due 2037, $2 billion of 1.50%Series B Convertible Senior Notes due 2037 and $2 billion of 1.50%Series C Convertible Senior Notes due 2037 (together, the \"ConvertibleNotes\"). Transocean has granted an option to the underwriters topurchase up to an additional $200 million of each of the Series A,Series B and Series C Convertible Notes. The Convertible Notesoffering is expected to result in net proceeds to Transocean of $5.94billion. The offering is expected to close on December 11, 2007,subject to the satisfaction of closing conditions.
The Convertible Notes will be convertible in certain circumstancesinto cash and a number of Transocean ordinary shares determined asdescribed in the prospectus supplement related to the offering. Theinitial conversion rate of the Convertible Notes is 5.9310, equivalentto a conversion price per ordinary share of approximately $168.61. Theconversion price represents a conversion premium of approximately32.5% to the closing price of Transocean ordinary shares on the NewYork Stock Exchange on December 5, 2007, of $127.25. In addition, ifcertain fundamental changes occur on or before December 20, 2010, withrespect to Series A Convertible Notes, December 20, 2011, with respectto Series B Convertible Notes or December 20, 2012, with respect toSeries C Convertible Notes, Transocean will in some cases increase theconversion rate for a holder electing to convert notes in connectionwith such fundamental change.
Upon conversion, Transocean is obligated to settle the ConvertibleNotes by delivering cash up to the aggregate principal amount of theConvertible Notes to be converted and ordinary shares in respect ofthe remainder, if any, of Transocean's conversion obligation in excessof the aggregate principal amount of the Convertible Notes beingconverted.
Goldman, Sachs & Co. and Lehman Brothers Inc. are jointbookrunning managers for the Convertible Notes offering, Citi is ajoint bookrunning manager for the offering of Series A and CConvertible Notes and Credit Suisse is a joint bookrunning manager forthe offering of Series B Convertible Notes.
Transocean will have the right to redeem the Convertible Notes forcash on or after December 20, 2010, in the case of the Series AConvertible Notes, December 20, 2011, in the case of the Series BConvertible Notes, and December 20, 2012, in the case of the Series CConvertible Notes, at a redemption price equal to 100% of theprincipal amount of the notes, plus accrued and unpaid interest, ifany, up to, but excluding, the redemption date. A holder of the SeriesA Convertible Notes and the Series B Convertible Notes will have theright to require Transocean to repurchase their notes on December 15,2010 and December 15, 2011, respectively. In addition, holders of eachseries of Convertible Notes will have the right to require Transoceanto repurchase their notes on December 14, 2012, December 15, 2017,December 15, 2022, December 15, 2027 and December 15, 2032 or upon afundamental change, in each case at a repurchase price in cash equalto 100% of the principal amount of the notes, plus accrued and unpaidinterest, if any, up to, but excluding, the repurchase date.
Transocean intends to use the $5.94 billion of net proceeds fromits proposed Convertible Notes offering (or up to $6.53 billion if theunderwriters exercise their option to purchase additional ConvertibleNotes in full), together with $2.47 billion of net proceeds from theproposed Senior Notes offering and $1.5 billion of borrowings underits $1.5 billion 364-day revolving credit facility, to repay a portionof the outstanding borrowings under Transocean's $15.0 billion bridgeloan facility that were incurred to fund cash payments to shareholdersin connection with Transocean's recently completed reclassification ofits ordinary shares and merger with GlobalSantaFe Corporation.
The notes will be issued under a shelf registration statementfiled by Transocean with the Securities and Exchange Commission onDecember 3, 2007, which became automatically effective.
This press release is neither an offer to sell nor a solicitationof an offer to buy the securities described herein, nor shall there beany sale of these securities in any jurisdiction in which such anoffer, solicitation or sale would be unlawful prior to registration orqualification under the securities laws of any such jurisdiction. Theoffering of these securities will be made only by means of aprospectus and related prospectus supplement. When available, copiesof the prospectus and related prospectus supplement in respect of anyof these securities may be obtained from Goldman, Sachs & Co., Attn:Prospectus Dept., 85 Broad St., New York, New York 10004, via fax at(212) 902-9316 or e-mail at email@example.com and LehmanBrothers Inc., c/o Broadridge Financial Services, IntegratedDistribution Services, 1155 Long Island Avenue, Edgewood, NY 11717,fax (631) 254-7140 or by e-mail at firstname.lastname@example.org.
Transocean Inc. is the world's largest offshore drillingcontractor and the leading provider of drilling management servicesworldwide. With a fleet of 140 mobile offshore drilling units pluseight High-Specification units under construction, the company's fleetis considered one of the most modern and versatile in the world due toits emphasis on technically demanding segments of the offshoredrilling business. The company owns or operates a contract drillingfleet of 39 High-Specification Floaters, 29 Other Floaters, 68 Jackupsand four other assets utilized in the support of offshore drillingactivities worldwide. With a current equity market capitalization inexcess of $40 billion, Transocean Inc.'s ordinary shares are traded onthe New York Stock Exchange under the symbol \"RIG.\"
Statements included in this news release regarding borrowingsunder the company's 364-day revolving credit facility and the timing,amounts, use of proceeds and other aspects of the proposed offerings,are forward-looking statements that involve certain assumptions. Thesestatements involve risks and uncertainties including, but not limitedto, market conditions, closing conditions, Transocean's results ofoperations and other factors detailed in Transocean's filings with theSecurities and Exchange Commission. Should one or more of these risksor uncertainties materialize (or the other consequences of such adevelopment worsen), or should underlying assumptions prove incorrect,actual outcomes may vary materially from those forecasted or expected.Transocean disclaims any intention or obligation to update publicly orrevise such statements, whether as a result of new information, futureevents or otherwise.
CONTACT: Transocean Inc., Houston
Gregory S. Panagos, 713-232-7551
Guy A. Cantwell, 713-232-7647
SOURCE: Transocean Inc.