Transocean sell 38 shallow water drilling rigs $1.05 billion

Transocean to sell 38 shallow water drilling rigs for $1.05 billion

6:18 AM, 10th September 2012
Transocean to sell 38 shallow water drilling rigs for $1.05 billion
Steven L Newman, President and CEO, Transocean Ltd.

VERNIER, SWITZERLAND: Transocean Ltd agreed to sell 38 shallow water drilling rigs to Shelf Drilling International Holdings Ltd (Shelf Drilling) for approximately $1.05 billion. Shelf Drilling is a newly formed company sponsored equally by Castle Harlan Inc, CHAMP Private Equity and Lime Rock Partners. The sales price includes approximately $855 million in cash, subject to working capital and other closing adjustments and $195 million in seller financing. The transactions are expected to close in the fourth quarter of 2012, subject to certain conditions.

“This agreement marks an important milestone in our asset strategy to increase our focus on high-specification floaters and jackups, improving our long-term competitiveness,” said Steven L Newman, President and CEO, Transocean Ltd.

“This is an exciting opportunity with great potential. Our strategy will be to maintain an exclusive focus on shallow water drilling,” said David Mullen, President and CEO, Shelf Drilling.

Related to the Shelf Drilling transactions, Transocean expects its third quarter 2012 results to include a non-cash charge related to impairment of the long-lived assets or goodwill allocable to these assets. As of June 30, 2012, the aggregate carrying amount of the long-lived assets included in the transactions was approximately $1.4 billion. The sales price includes approximately $200 million related to the net current assets associated with the transactions. Transocean's total aggregate consolidated goodwill as of June 30, 2012 was $3.1 billion, a portion of which is expected to be allocated to the assets included in the transactions.

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