Transocean Ltd. (NYSE: RIG) announced today that Transocean Inc.,
its wholly-owned subsidiary (together with Transocean Ltd.,
“Transocean”), has received over $1.5 billion aggregate principal
amount of validly tendered Exchange Notes (as defined below) as of
September 4, 2020, pursuant to its previously announced offers (the
“Exchange Offers”) to exchange certain existing notes (the
“Existing Notes”) for up to an aggregate principal amount of $750
million (subject to increase or decrease by Transocean Inc., the
“Maximum New Notes Amount”) of new 11.50% Senior Guaranteed Notes
(the “New 2027 Senior Guaranteed Notes”) issued by Transocean Inc.,
pursuant to an Exchange Offer Memorandum and Consent Solicitation
Statement, dated August 10, 2020 (as supplemented by the
Supplement, dated August 24, 2020, and as may be further
supplemented, the “Exchange Offer Memorandum”). Following the
denial by the United States District Court for the Southern
District of New York (the “Court”) of certain attempts to block the
Exchange Offers, as further described below, Transocean intends to
proceed with the Exchange Offers, including extending the Exchange
Offers until the Revised Expiration Time (as defined below).
On September 2, 2020, two days prior to the
initial expiration of the Exchange Offers, funds managed by, or
affiliated with, Whitebox Advisors LLC (“Whitebox”), as a holder of
Transocean Inc.’s 7.50% Senior Notes due 2025 (the “Existing
2025 Guaranteed Notes”), 7.50% Senior Notes due 2026, 8.00% Senior
Notes due 2027 (the “Existing 2027 Guaranteed Notes”) and
6.80% Senior Notes due 2038, filed a complaint in the Court
requesting a temporary restraining order and preliminary injunction
(the “TRO and Injunction”) relating to the Exchange Offers.
Subsequent to the filing of the TRO and Injunction, Whitebox and
funds managed by, or affiliated with, Pacific Investment Management
Company LLC (“PIMCO”), as holders, together, of 25.1% in aggregate
principal amount of the Existing 2027 Guaranteed Notes, provided a
notice of default (the “Notice”) to Transocean Inc. alleging a
default under the indenture governing the Existing 2027 Guaranteed
Notes. Both the complaint, including the request for the TRO and
Injunction, and the Notice relate to an underlying allegation that
Transocean Mid Holdings 1 Limited (“Mid Holdings 1”), Transocean
Mid Holdings 2 Limited (“Mid Holdings 2”) and Transocean Mid
Holdings 3 Limited (“Mid Holdings 3”, and collectively with Mid
Holdings 1 and Mid Holdings 2, the “Structurally Senior
Guarantors”) should have, but did not, guarantee the Existing 2025
Guaranteed Notes and Existing 2027 Guaranteed Notes. Transocean
believes these assertions are meritless.
On September 3, 2020, Transocean, as defendant,
and Whitebox, as plaintiff, each presented its arguments regarding
Whitebox’s request for the TRO and Injunction to the Court. The
Court promptly denied the TRO and Injunction request. In addition,
on September 7, 2020, Transocean delivered a response to PIMCO and
Whitebox demanding a withdrawal of the Notice. Transocean maintains
that the previously announced internal reorganizations and Exchange
Offers comply with the terms of its existing indentures and that
the Structurally Senior Guarantors are not required to, and will
not, guarantee any of Transocean’s notes (including the Existing
2025 Guaranteed Notes and Existing 2027 Guaranteed Notes).
Transocean will continue to defend itself vigorously against the
lawsuit and any related future claims.
As a result of the interference caused by the
filing of the TRO and Injunction and the delivery of the Notice,
both of which Transocean believes are meritless, Transocean has
elected to extend the Exchange Offers to provide Eligible Holders
of Existing Notes the opportunity to continue to support Transocean
and participate in the Exchange Offers.
Transocean has (i) extended the Expiration Time
of the Exchange Offers to 5:00 p.m., New York City time, on
September 9, 2020 (the “Revised Expiration Time”) and (ii) elected
to provide withdrawal rights to any Eligible Holders who have
tendered or will tender Existing Notes prior to the Revised
Expiration Time until 5:00 p.m., New York City time, on
September 9, 2020 (the “Withdrawal Deadline”). Eligible
Holders who validly tender Existing Notes prior to the Revised
Expiration Time and do not validly withdraw prior to the Withdrawal
Deadline in accordance with the instructions provided in the
Exchange Offer Memorandum will be eligible to receive the
applicable total consideration, subject to the conditions set forth
in the Exchange Offer Memorandum. Holders may withdraw any tendered
Existing Notes on or prior to the Withdrawal Deadline in accordance
with the Exchange Offer Memorandum. All other terms of the Exchange
Offers remain the same.
Holders of Existing Notes who have previously
tendered Existing Notes do not need to retender such Existing Notes
or take any other action in response to the amendments and will be
entitled to receive the applicable total consideration, subject to
the conditions set forth in the Exchange Offer Memorandum.
According to information received from D.F. King
& Co., Inc., the exchange agent and information agent for the
Exchange Offers, as of 11:59 p.m., New York City time, on September
4, 2020, approximately $1.5 billion in aggregate principal
amount of Existing Notes had been validly tendered, consisting
of:
Title of Existing Notes |
|
AcceptancePriority Level(2) |
|
Total Consideration(3) |
|
Aggregate PrincipalAmount Tendered |
6.375% Senior Notes due
2021(1) |
|
1 |
|
$825.00 |
|
$37,472,000 |
3.800% Senior Notes due
2022(1) |
|
2 |
|
$730.00 |
|
$132,138,000 |
7.25% Senior Notes due 2025 |
|
3 |
|
$475.00 |
|
$210,407,000 |
7.50% Senior Notes due 2026 |
|
4 |
|
$465.00 |
|
$168,830,000 |
8.00% Senior Notes due 2027 |
|
5 |
|
$455.00 |
|
$148,945,000 |
8.00% Debentures due 2027 |
|
6 |
|
$375.00 |
|
$35,455,000 |
7.45% Notes due 2027 |
|
7 |
|
$405.00 |
|
$35,457,000 |
7.00% Notes due 2028 |
|
8 |
|
$375.00 |
|
$38,823,000 |
7.50% Notes due 2031 |
|
9 |
|
$395.00 |
|
$194,600,000 |
6.80% Senior Notes due 2038 |
|
10 |
|
$375.00 |
|
$388,172,000 |
7.35% Senior Notes due
2041(1) |
|
11 |
|
$395.00 |
|
$110,765,000 |
______________
(1) The interest rate for the 2021 Notes, 2022
Notes and 2041 Notes has been increased to 8.375%, 5.800% and
9.35%, respectively, pursuant to the terms of the applicable
indenture.(2) The Maximum New Notes Amount of New 2027 Senior
Guaranteed Notes that may be issued to Eligible Holders pursuant to
the Exchange Offers is $750 million, not including up to an
additional $32 million principal amount of New 2027 Senior
Guaranteed Notes that may be issued in the previously announced
separate exchange for certain committed Existing Notes. Transocean
reserves the right, in its sole discretion, subject to applicable
law, to increase or decrease the Maximum New Notes Amount, but
there can be no assurance that Transocean will do so. Existing
Notes accepted for exchange on the settlement date will be accepted
in accordance with their Acceptance Priority Levels set forth
herein (with “1” being the highest Acceptance Priority Level and
“11” being the lowest Acceptance Priority Level). Transocean will
only accept for exchange Existing Notes in the Exchange Offers up
to an aggregate principal amount that will not result in the
aggregate principal amount of New Senior Guaranteed Notes issued
pursuant to the Exchange Offers to exceed the Maximum New Notes
Amount.(3) Consideration in the form of principal amount of New
2027 Senior Guaranteed Notes per $1,000 principal amount of
Existing Notes that are validly tendered and accepted for exchange,
subject to rounding. Excludes accrued and unpaid interest, which
will be paid in cash in addition to the applicable total
consideration.
Based on the applicable total consideration and
the amounts tendered to date, approximately $682 million
aggregate principal amount of New 2027 Senior Guaranteed Notes
would be issued. Transocean intends to accept for exchange Existing
Notes validly tendered and not validly withdrawn prior to the
Revised Expiration Time, subject to the Maximum New Notes Amount
and the Acceptance Priority Levels.
Each Exchange Offer is a separate offer, and
each may be individually amended, extended, terminated or
withdrawn, subject to certain conditions and applicable law, at any
time in Transocean Inc.’s sole discretion, and without amending,
extending, terminating or withdrawing any other Exchange Offer. No
Exchange Offer is conditioned upon any minimum principal amount of
Existing Notes of any series being tendered nor the consummation of
any other Exchange Offer. Additionally, notwithstanding any other
provision of the Exchange Offers, Transocean Inc.’s obligation to
accept and exchange any of the Existing Notes validly tendered
pursuant to the Exchange Offers is subject to the satisfaction or
waiver of certain conditions, as described in the Exchange Offer
Memorandum, and Transocean Inc. expressly reserves the right,
subject to applicable law, to terminate any Exchange Offer at any
time.
Full details of the terms and conditions of the
Exchange Offers are described in the Exchange Offer Memorandum. The
Exchange Offers are only being made pursuant to, and the
information in this press release is qualified in its entirety by
reference to, the Exchange Offer Memorandum, which is being sent by
Transocean Inc. to Eligible Holders of the Existing Notes. Eligible
Holders of the Existing Notes are encouraged to read these
documents, as they contain important information regarding the
Exchange Offers. This press release is neither an offer to purchase
nor a solicitation of an offer to buy any Existing Notes in the
Exchange Offers.
Requests for the Exchange Offer Memorandum and
other documents relating to the Exchange Offers may be directed to
D.F. King & Co., Inc., the exchange agent and information agent
for the Exchange Offers, at (212) 269-5550 (for banks and brokers
only) or (800) 967-5051 (toll-free) (for all others) or
transocean@dfking.com.
None of Transocean Ltd., Transocean Inc., any of
their respective subsidiaries, their respective boards of directors
or directors, the dealer manager and solicitation agent, the
exchange agent and information agent or any trustee or any of
Transocean Ltd.’s, Transocean Inc.’s or any of their subsidiaries’
respective affiliates, or such respective affiliates, is making any
recommendation as to whether Eligible Holders should tender any
Existing Notes in response to the Exchange Offers and no one has
been authorized by any of them to make such a recommendation.
The Exchange Offers are being made, and the New
2027 Senior Guaranteed Notes are being offered, only to holders of
the Existing Notes who are either (a) persons other than “U.S.
persons” as defined in Regulation S, and who agree to purchase the
New 2027 Senior Guaranteed Notes outside of the United States, and
who are otherwise in compliance with the requirements of Regulation
S; or (b) persons who are reasonably believed to be “qualified
institutional buyers” as defined in Rule 144A under the U.S.
Securities Act of 1933, as amended (the “Securities Act”) and to
whom the New 2027 Senior Guaranteed Notes are offered in the United
States in a transaction not involving a public offering, pursuant
to Section 4(a)(2) of the Securities Act; provided that, in each
case, if such holder is in the European Economic Area or the United
Kingdom, such holder is not a “retail investor”. For these
purposes, a “retail investor” means a person who is one (or more)
of: (i) a “retail client” as defined in point (11) of Article 4(1)
of Directive 2014/65/EU (as amended, “MiFID II”); or (ii) a
“customer” within the meaning of Directive (EU) 2016/97, where that
customer would not qualify as a professional client as defined in
point (10) of Article 4(1) of MiFID II; or (iii) not a “qualified
investor” as defined in Regulation (EU) 2017/1129. The holders of
Existing Notes who have certified to Transocean Inc. that they are
eligible to participate in the Exchange Offers pursuant to at least
one of the foregoing conditions are referred to as “Eligible
Holders.” Eligible Holders may go to www.dfking.com/transocean to
confirm their eligibility.
The Exchange Offers are not being made to
Eligible Holders of Existing Notes in any jurisdiction in which the
making or acceptance thereof would not be in compliance with the
securities, blue sky or other laws of such jurisdiction. In any
jurisdiction in which the Exchange Offers are required to be made
by a licensed broker or dealer, the Exchange Offers will be deemed
to be made on behalf of Transocean Inc. by the dealer manager and
solicitation agent, or one or more registered brokers or dealers
that are licensed under the laws of such jurisdiction.
The New 2027 Senior Guaranteed Notes have not
been and will not be registered under the Securities Act, or any
state securities laws and may not be offered or sold in the United
States, except pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities Act
and applicable state securities laws. The New 2027 Senior
Guaranteed Notes may not be publicly offered, directly or
indirectly, in Switzerland within the meaning of the Swiss
Financial Services Act (“FinSA”) (unless in circumstances falling
within article 36 of the FinSA). This press release shall not
constitute an offer to sell or a solicitation of an offer to buy
the New 2027 Senior Guaranteed Notes in the United States, shall
not constitute an offer, solicitation or sale of the New 2027
Senior Guaranteed Notes in any jurisdiction where such offering or
sale would be unlawful and does not constitute a prospectus within
the meaning of the FinSA or advertising within the meaning of the
FinSA. There shall not be any sale of the New 2027 Senior
Guaranteed Notes in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of such jurisdiction.
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 39 mobile offshore drilling
units, including 27 ultra-deepwater floaters and 12 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 include
statements regarding the terms and timing for completion of the
Exchange Offers, including the acceptance for purchase of any New
2027 Senior Guaranteed Notes validly tendered, the Revised
Expiration Time and Settlement Date thereof, the potential increase
or decrease to the Maximum New Notes Amount, and the satisfaction
or waiver of certain conditions of the Exchange Offers.
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, investor
response to Transocean Inc.’s Exchange Offers, 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
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