By Andrea Heisinger
New York, Sept. 10 - Transocean Inc. announced and priced a $1.5 billion issue of senior notes (Baa3/BBB-/BBB-) on Monday in two tranches, a source said.
The deal included $750 million of 2.5% five-year notes priced at 99.714 to yield 2.56% with a spread of 190 basis points over Treasuries. The notes were sold tighter than guidance in the low 200 bps area, the source said.
There is a make-whole call at Treasuries plus 30 bps.
There was also $750 million of 3.8% 10-year notes sold at 99.309 to yield 3.883% with a spread of 220 bps over Treasuries. The notes were also priced tighter than talk in the mid-200 bps area.
The 10-year tranche has a make-whole call at Treasuries plus 35 bps until July 15, 2022 and a par call after that date.
Barclays, Citigroup Global Markets Inc., J.P. Morgan Securities LLC and Wells Fargo Securities LLC were the active bookrunners. Passive bookrunners were Bank of America Merrill Lynch and DNB NOR Markets Inc.
Proceeds will be used to fund costs associated with the construction of four newbuild drillships.
The notes are guaranteed by Transocean Ltd., an offshore oil and drilling contractor based in Zug, Switzerland.
| Issuer: | Transocean Inc.
|
| Guarantor: | Transocean Ltd.
|
| Issue: | Senior notes
|
| Amount: | $1.5 billion
|
| Bookrunners: | Barclays, Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Wells Fargo Securities LLC (active), | Bank of America Merrill Lynch, DNB NOR Markets Inc. (passive)
|
| Trade date: | Sept. 10
|
| Settlement date: | Sept. 13
|
| Ratings: | Moody's: Baa3
|
| Standard & Poor's: BBB-
|
| Fitch: BBB-
|
|
|
| Five-year notes
|
| Amount: | $750 million
|
| Maturity: | Oct. 15, 2017
|
| Coupon: | 2.5%
|
| Price: | 99.714
|
| Yield: | 2.56%
|
| Spread: | Treasuries plus 190 bps
|
| Call: | Make-whole at Treasuries plus 30 bps
|
| Price talk: | Low 200 bps area
|
|
|
| 10-year notes
|
| Amount: | $750 million
|
| Maturity: | Oct. 15, 2022
|
| Coupon: | 3.8%
|
| Price: | 99.309
|
| Yield: | 3.883%
|
| Spread: | Treasuries plus 220 bps
|
| Call: | Make-whole at Treasuries plus 35 bps until July 15, 2022, par call after
|
| Price talk: | Mid 200 bps area
|
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