Company News

Transocean Buying Transocean Partners in $1.6B Deal

Rigzone
01/08/2016 21:13
Visualizações: 1005 (0) (0) (0) (0)

Transocean Ltd. is acquiring all outstanding common units of its master limited partnership (MLP), Transocean Partners LLC, in an all-equity deal estimated to have an enterprise value of $1.6 billion.

 

The share-for-unit transaction will grant the MLP’s unitholders 1.1427 Transocean shares for each partnership unit, which has an exchange ratio representing a 15 percent premium to its closing price July 29, according to a Transocean news release. Once the transaction is complete, the company will have a 51 percent ownership in the Discoverer Inspiration, the Discoverer Clear Leader and the Development Driller III.

 

Jeremy Thigpen, Transocean CEO, said in the statement that the all-equity transaction is consistent with the company’s liquidity objectives. In addition, the merger provides an immediate benefit to Transocean from a simplified administration and governance, as well as tangible cost savings, he said.

 

Analysts at Tudor Pickering Holt & Co. (TPH) in Houston said the non-cash deal increases Transocean’s liquidity and adds cash flow. Two of the three rigs that Transocean takes in the merger are contracted at $580,000 per day through October 2018.

 

In addition, TPH said in a note to investors, “We always struggled to see benefits of offshore rigs housed in an MLP [yield vehicle] given offshore pricing/contracting outlook.”

 

MLPs are typically structured as growth vehicles, and Transocean’s partnership took a 6.6 percent yield in its initial public offering. But in the current market, TPH noted, growth is “all but impossible.” The analysts said the merger is a nice step in the right direction, but it’s not a game changer.

 

Earlier this year, Thigpen said it will likely be another three years before Transocean and other large offshore drilling rig suppliers will be able to command higher rates for offshore rigs.

Most Read Today
see see
OTC Houston 2025
PPSA announces revision of the volume to be offered in t...
06/05/25
OTC Houston 2025
Fábio Mitidieri attends the opening of the Brazil Pavili...
06/05/25
Logistics
Vast completes 1,000th oil transshipment operation
06/05/25
Offshore Wind Energy
Brazil and the Netherlands promote seminar on offshore w...
06/05/25
Company News
Prime Energy expands operations in Minas Gerais
06/05/25
OTC Houston 2025
Brazil Brings the Largest Foreign Delegation to Oil and ...
05/05/25
OTC Houston 2025
IBP Featured in OTC Houston 2025 Lineup
05/05/25
OTC Houston 2025
To showcase Rio de Janeiro’s energy potential, Firjan ar...
05/05/25
OTC Houston 2025
Petrobras participates in OTC 2025, in Houston (USA
05/05/25
OTC Houston 2025
MODEC Group Professionals to Be Honored at OTC 2025
05/05/25
International Company News
TVO Adds to Global Business Development Team
01/05/25
Ethanol
Sugarcane production estimated at 663.4 million tons for...
30/04/25
OTC Houston 2025
Brazilian industry to attend OTC 2025 aiming to expand i...
30/04/25
Carbon Capture
Impact Hub and Tencent launch program offering up to 1 m...
30/04/25
International
Petrobras presents investment opportunities in the naval...
30/04/25
Results
Petrobras production grows 5.4% and reaches 2.8 million ...
30/04/25
Carbon Reduction
Report: Baker Hughes Achieves Nearly 40% Reduction in Op...
29/04/25
Natural Gas
Comgás launches public call for natural gas acquisition
29/04/25
Royalties
Values related to February production under concession a...
29/04/25
Biogas
TBG develops Biogas Hub project to boost biofuel integra...
29/04/25
OTC Houston 2025
OTC 2025 Announces Emerging Leaders Class
25/04/25
VEJA MAIS
Newsletter TN

Contact us

We use cookies to ensure you have the best experience on our website. If you continue to use this site, we will assume that you agree with our Privacy Policy, terms of use and cookies.