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Saturday, August 18, 2018

Transocean Ltd. to Acquire Transocean Partners LLC

Maritime Activity Reports, Inc.

August 1, 2016

Disoverer Enterprise Vertical Photo Transocean

Disoverer Enterprise Vertical Photo Transocean

Transocean Ltd. and Transocean Partners LLC (NYSE: RIGP) today announced that Transocean has agreed to acquire all of the outstanding common units of Transocean Partners not already owned by Transocean in a share-for-unit merger transaction. In the merger, Transocean Partners common unitholders will receive 1.1427 Transocean shares for each Transocean Partners common unit.

The Transocean Partners unit price implied by the exchange ratio represents a 15% premium to Transocean Partners' closing price on July 29, 2016. Transocean expects to issue approximately 22.7 million shares in the merger. Completion of the transaction is conditioned upon approval by Transocean Partners' common unitholders and is anticipated to close in the fourth quarter of 2016.

Following completion of the transaction, Transocean Partners will be 100% owned by Transocean and therefore Transocean will have indirectly acquired the 51% ownership interests in the Discoverer Inspiration, the Discoverer Clear Leader and the Development Driller III that are currently owned by Transocean Partners. Additionally, Transocean Partners' common units will cease to be publicly traded on the NYSE.

"We are excited about this merger, as it provides significant and immediate benefits to Transocean in the form of simplified administration and governance, tangible cost savings and improved liquidity," said Jeremy Thigpen, President and Chief Executive Officer of Transocean. "The contemplated all-equity transaction is entirely consistent with Transocean's current liquidity objectives."

"Transocean Partners common unitholders will benefit from a premium to the current unit price and receive shares in an entity with significant financial flexibility, a demonstrated access to capital and meaningfully improved market liquidity of its shares," said Kathleen McAllister, Chief Executive Officer and Chief Financial Officer of Transocean Partners. "Additionally, we expect that common unitholders will also benefit from Transocean's significantly larger and more diverse fleet and its industry-leading contract backlog."

Approvals and Timeline to Completion

The transaction is subject to the approval of the holders of Transocean Partners' common units pursuant to its limited liability company agreement. As Transocean has already committed to voting its approximately 21.3 million common units in favor of the merger, a vote in favor of the merger by approximately 9.9 million (or approximately 50.1%) of the approximately 19.7 million common units not held by Transocean will be required to approve the merger. Subject to customary approvals and conditions, the transaction is expected to close in the fourth quarter of 2016. The transaction is expected to generally be non-taxable to Transocean Partners common unitholders.

The transaction was negotiated on behalf of Transocean Partners by the Conflicts Committee of its Board of Directors, which is comprised of the members of its Board of Directors who are independent and unaffiliated with Transocean.

Transocean Partners' minimum quarterly distribution of $0.3625 per unit for the third quarter of 2016 is expected to be paid in the fourth quarter of 2016.
 

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