Transocean calls zero-coupon, 1.5% convertibles

By Angela McDaniels

Seattle, Oct. 19 - Transocean Inc. said it will redeem its zero-coupon convertible debentures due May 2020 and its 1.5% convertible debentures due 2021 on Nov. 15.

Holders will receive $710.29 per $1,000 principal amount of zero-coupon debentures and par plus accrued interest for the 1.5% debentures, according to a company news release.

The zero-coupon debentures are convertible into 8.1566 shares each, which equals a conversion price of $122.60, and will remain convertible until the close of business on Nov. 14.

The 1.5% debentures are convertible into 13.8627 shares each, which equals a conversion price of $72.14, and will remain convertible until the close of business on Nov. 9.

Transocean shares closed at $110.70 (NYSE: RIG) on Friday.

If all holders convert before the redemption date, Transocean said it will issue 5,756,702 ordinary shares in total. If no debentures are converted, the total cost to redeem them will be about $421 million.

The Houston-based offshore drilling contractor will use existing cash balances and borrowings under its revolving credit facility to fund the redemption.

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