STEINHAUSEN, Switzerland - Transocean Ltd . (NYSE:RIG), a prominent offshore drilling contractor, has initiated a private offering of senior notes valued at $1.5 billion, the company disclosed today. The offering comprises Senior Notes due in 2029 and 2031, aimed at eligible purchasers under Rule 144A/Regulation S.
The notes will be guaranteed by Transocean Ltd. and certain subsidiaries, with the guarantee being senior and unsecured. The timing and terms of the notes are contingent on market conditions and other factors.
A portion of the net proceeds from the offering will fund the cash purchase offer for all outstanding 11.50% Senior Guaranteed Notes due 2027 and 7.25% Senior Notes due 2025, including related premiums and expenses. Remaining proceeds are intended for the redemption of other priority guaranteed notes.
In conjunction with the notes offering and purchase offers, Transocean has issued a conditional notice to redeem all 2025 Priority Guaranteed Notes remaining after the purchase offers. The redemption, contingent on the completion of the offering, is scheduled for April 23, 2024, and will be at par value plus accrued interest.
The notes are not registered under the U.S. Securities Act of 1933 or any state securities laws, and may not be offered or sold in the United States without registration or exemption. Similarly, the notes have not been and will not be publicly offered in Switzerland under the Swiss Financial Services Act, nor will they be admitted to trading on any Swiss trading venue.
Transocean specializes in offshore contract drilling services, particularly in ultra-deepwater and harsh environment sectors. The company owns or has interests in a fleet of 36 mobile offshore drilling units and is constructing an additional ultra-deepwater drillship.
The information in this article is based on a press release statement from Transocean Ltd.
InvestingPro Insights
As Transocean Ltd. (NYSE:RIG) ventures into a significant private offering of senior notes, investors and potential stakeholders might find the following InvestingPro Insights particularly relevant. With a market capitalization of $5.32 billion, the company is navigating through challenging financial waters, as reflected in its negative P/E ratio of -7.21 for the last twelve months as of Q4 2023. This metric underscores that the company has not been profitable over the past year, a situation that is echoed by analysts who do not expect the company to be profitable this year.
On a more positive note, Transocean has seen strong returns over the last month and three months, with price total returns of 20.63% and 17.17% respectively. This suggests a recent uptrend in investor confidence that could be linked to strategic moves such as the current notes offering. Additionally, the company's liquid assets exceed its short-term obligations, indicating a degree of liquidity that could provide some financial flexibility in the near term.
InvestingPro Tips for Transocean reveal that the stock has been experiencing volatility and is currently in overbought territory according to the RSI indicator. This could suggest a potential pullback in the near future, which is a critical piece of information for investors considering capitalizing on the company's recent gains. Moreover, three analysts have revised their earnings estimates downwards for the upcoming period, signaling caution for those looking at the company's future earnings potential.
For those looking to delve deeper into Transocean's financial health and stock performance, additional InvestingPro Tips are available at https://www.investing.com/pro/RIG. Currently, there are more than 9 additional tips to explore, offering a comprehensive analysis of the company's financial status and stock behavior. Interested readers can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, granting access to the full range of insights and analytics that InvestingPro has to offer.
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