Moody's: Transocean up to positive

Moody's Investors Service said it affirmed Transocean Inc.'s Baa2 senior unsecured debt rating and revised the outlook to positive from stable.

Moody's said the outlook change reflects an improving financial leverage profile, the potential for improvement in the company's financial results over the near- to medium-term based on rising demand for its deepwater drilling rigs and reduced exposure to the volatile shallow-water Gulf of Mexico market.

An upgrade of Transocean's Baa2 senior unsecured ratings will depend on the company's success in continuing to reduce its debt burden and in generating returns through the drilling cycle that are more in line with those of its more highly rated peers (Adjusted Debt/Retained Cash Flow below 3x and EBIT margins in the 20% range), according to Moody's.

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