Transocean Ltd. (NYSE: RIG) announced today that it, Transocean
Inc. (together with Transocean Ltd., the “Company”) and certain of
its subsidiaries executed amendments to certain of their financing
documents and implemented certain internal reorganization
transactions to resolve the allegations contained in the previously
disclosed notices of alleged default (the “Notices”) with respect
to Transocean Inc.’s 7.25% Senior Notes due 2025 (the “2025
Guaranteed Notes”) and 8.00% Senior Notes due 2027 (the “2027
Guaranteed Notes”).
Immediately following such transactions and
amendments (the “Transactions”), the Transocean Mid Holdings
Entities (as defined below) have been eliminated and the Transocean
Holdings Entities (as defined below) directly hold the equity
interests of the Transocean Asset Holdings Entities (as defined
below), exactly as they did prior to the Company’s previously
announced internal reorganization and exchange transactions (the
“Prior Transactions”). As a result, any claim of an alleged breach
under any of the Company’s existing financing documents in respect
of a transfer of the assets of the Transocean Holdings Entities
resulting from the Prior Transactions has been rendered moot and
cured (to the extent it ever existed, which the Company continues
to unequivocally reject.)
The Company maintains that the Prior
Transactions did not breach the indentures governing the 2027
Guaranteed Notes or 2025 Guaranteed Notes or any other financial
instrument and it continues to proactively take steps to protect
its interests and the interests of its shareholders, customers and
employees against what the Company believes to be meritless
allegations by certain of its debtholders. Nevertheless, as part of
its prudent assessment of its strategies in connection with the
Notices, and while the Company awaits a ruling from the U.S.
District Court for the Southern District of New York on its request
for summary judgment, the Company has elected to implement the
Transactions prior to the expiration of the permitted cure period
under the indentures governing the 2027 Guaranteed Notes and 2025
Guaranteed Notes. The Transactions thereby resolved such
allegations prior to the purported breach described in the Notices
maturing into an alleged “Event of Default,” which the Company
would also vigorously dispute.
For the avoidance of doubt, the Transactions do
not impact the structural position of the holders of the Company’s
existing indebtedness, including the Existing Guaranteed Notes, the
Senior Guaranteed Securities and the Revolving Credit Facility
(each as defined below). In addition, prior to and following the
consummation of the Transactions, the Company has maintained $1.3
billion of available borrowing capacity under its Revolving Credit
Facility, with no borrowings currently outstanding and $30 million
of letters of credit issued thereunder.
The internal reorganization transactions
consisted of:
- the contributions (the “Contributions”) by Transocean Asset
Holdings 1 Limited, Transocean Asset Holdings 2 Limited and
Transocean Asset Holdings 3 Limited (collectively, the “Transocean
Asset Holdings Entities”) of their respective assets, consisting of
equity interests in subsidiaries, to newly-formed, wholly-owned
subsidiaries, Transocean Sub Asset Holdings 1 Limited,
Transocean Sub Asset Holdings 2 Limited and Transocean Sub Asset
Holdings 3 Limited (collectively, the “Transocean Sub Asset
Holdings Entities”), respectively, and, following the
Contributions,
- the mergers (the “Mergers”) of Transocean Mid Holdings 1
Limited, Transocean Mid Holdings 2 Limited and Transocean Mid
Holdings 3 Limited (collectively, the “Transocean Mid Holdings
Entities”) with and into Transocean Holdings 1 Limited, Transocean
Holdings 2 Limited and Transocean Holdings 3 Limited
(collectively, the “Transocean Holdings Entities”), respectively,
with Transocean Holdings 1 Limited, Transocean Holdings 2 Limited
and Transocean Holdings 3 Limited as the respective surviving
entities of such Mergers.
Immediately following such Mergers, each of
Transocean Holdings 1 Limited, Transocean Holdings 2 Limited and
Transocean Holdings 3 Limited directly wholly-own all of the
outstanding equity of Transocean Asset Holdings 1 Limited,
Transocean Asset Holdings 2 Limited and Transocean Asset Holdings 3
Limited, respectively, exactly as they did before the Prior
Transactions. A simplified structure chart setting forth the
subsidiaries of Transocean Inc. after giving effect to the
Transactions is available at the link at the end of this
announcement.
In connection with the Contributions, Transocean
Inc., the Transocean Asset Holdings Entities and the Transocean Sub
Asset Holdings Entities entered into an amendment to the Company’s
existing credit agreement dated June 22, 2018 (as amended, the
“Revolving Credit Facility”), which amendment provides, among other
things, that the Transocean Sub Asset Holdings Entities guarantee
the obligations under the Revolving Credit Facility and permits the
Transocean Asset Holdings Entities to, among other things,
guarantee certain other obligations, including the Senior
Guaranteed Securities. Accordingly, the Revolving Credit Facility
will remain structurally senior to the unsecured debt securities
issued by Transocean Inc., including the Existing Guaranteed Notes
and the Senior Guaranteed Securities, to the extent of the value of
the assets of Transocean Sub Asset Holdings Entities due to the
fact that such other debt securities, including the Existing
Guaranteed Notes and the Senior Guaranteed Securities, do not, and
will not, benefit from guarantees from the Transocean Sub Asset
Holdings Entities.
In connection with the Mergers, the Company, the
guarantors, and Wells Fargo Bank, National Association, as trustee
(the “Trustee”), entered into a supplemental indenture to each of
(i) the Indenture, dated September 11, 2020, among the
Company, the guarantors party thereto and the Trustee, governing
the Company’s 11.50% Senior Guaranteed Notes due 2027 (the “Senior
Guaranteed Notes”), and (ii) the Indenture, dated August 14, 2020,
among the Company, the guarantors party thereto and the Trustee,
governing the Company’s 2.5% Senior Guaranteed Exchangeable Bonds
due 2027 (the “Senior Guaranteed Exchangeable Bonds” and together
with the Senior Guaranteed Notes, the “Senior Guaranteed
Securities”).
Pursuant to each such supplemental indenture,
the Transocean Holdings Entities expressly assumed the obligations
of the Transocean Mid Holdings Entities under their respective
guarantees of the Senior Guaranteed Securities as a result of the
Mergers, and the Transocean Asset Holding Entities have also
guaranteed the Senior Guaranteed Securities. Accordingly, the
Senior Guaranteed Securities will remain structurally senior to
other debt securities issued by Transocean Inc. including the 7.25%
Senior Notes due 2025, 7.50% Senior Notes due 2026 and 8.00% Senior
Notes due 2027 (collectively, the “Existing Guaranteed Notes”), to
the extent of the value of the assets of the Transocean Asset
Holdings Entities. This structural seniority remains because such
other debt securities, including the Existing Guaranteed Notes, do
not, and will not, benefit from guarantees from the Transocean
Asset Holdings Entities.
Nothing in this announcement is or shall be
construed as an admission of fact or liability, a stipulation or a
waiver, or binding on the Company or its affiliates or an
acknowledgement of any breach or default under any financial
instrument of the company, including, but not limited to the 2027
Guaranteed Notes or 2025 Guaranteed Notes. Each statement contained
herein is made without prejudice, with a full reservation of all
rights, remedies, claims and defenses.
About Transocean
Transocean is a leading international provider
of offshore contract drilling services for oil and gas wells. The
company specializes in technically demanding sectors of the
offshore drilling business with a particular focus on
ultra-deepwater and harsh environment drilling services. The
company’s mobile offshore drilling fleet is considered one of the
most versatile fleets in the world.
Transocean owns or has partial ownership
interests in and operates a fleet of 38 mobile offshore drilling
units, including 27 ultra-deepwater floaters and 11 harsh
environment floaters. In addition, Transocean is constructing two
ultra-deepwater drillships.
Forward-Looking Statements
This press release contains certain
forward-looking information and forward-looking statements as
defined in applicable securities laws (collectively referred to as
“forward-looking statements”). Forward-looking statements involve
known and unknown risks, uncertainties and other factors, which may
cause the actual results, performance or achievements of Transocean
to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements. Factors that may cause actual results to vary include,
but are not limited to, conditions in financial markets and other
risk factors as detailed from time to time in Transocean Ltd.’s
reports filed with the U.S. Securities and Exchange Commission.
Readers are cautioned against unduly relying on
forward-looking statements. Forward-looking statements speak only
as of the date hereof, and, except as required by law, Transocean
undertakes no obligation to update publicly or otherwise revise any
forward-looking statements, whether as a result of new information
or future events or otherwise.
Analyst Contact:Lexington
May+1 832-587-6515
Media Contact:Pam Easton+1 713-232-7647
A photo accompanying this announcement is available
at https://www.globenewswire.com/NewsRoom/AttachmentNg/ab6f84ab-82a9-48f6-aebf-5a03fe4333f5
Transocean (NYSE:RIG)
Historical Stock Chart
From Mar 2024 to Apr 2024
Transocean (NYSE:RIG)
Historical Stock Chart
From Apr 2023 to Apr 2024