Transocean Ltd. announced that its wholly-owned subsidiary Transocean Inc., has priced its previously-announced offering of senior unsecured notes.
Transocean will issue $1.25 billion in aggregate principal amount of senior unsecured notes due 2023 pursuant to Rule 144A/Regulation S to eligible purchasers. The notes will be guaranteed by Transocean Ltd. and certain of Transocean Inc.'s subsidiaries.
The notes will bear interest at the rate of 9 percent per annum and will be callable on or after July 15, 2020. The offering is expected to close on or about July 21, 2016, subject to customary closing conditions. Transocean expects to receive aggregate net proceeds of approximately $1.21 billion from the offering, after deducting the initial purchasers' discounts and estimated offering costs.
Transocean said it intends to use a portion of the net proceeds from the offering to fund its previously-announced tender offers to purchase for cash up to $1 billion aggregate principal amount of its 6.5 percent Senior Notes due 2020, 6.375 percent Senior Notes due 2021 and 3.8 percent Senior Notes due 2022 (collectively, the "Existing Notes"), subject to the terms and conditions specified in the related offer to purchase, and a portion of the net proceeds from the offering are intended to be used to refinance existing indebtedness and for general corporate purposes. Should the tender offers not be consummated, or if net proceeds allocated to fund the tender offers remain following consummation of the tender offers, Transocean Inc. intends to also use such net proceeds to refinance existing indebtedness and for general corporate purposes.