Transocean Seeks to Cancel Two Dividend Payments
August 25 2015 - 5:47PM
Dow Jones News
By Josh Beckerman
Transocean Ltd. is seeking to cancel the third and fourth
installments of its dollar-denominated dividend this year, which
the company had already approved in May.
Shares dropped 12% to $10.75 in after-hours trading. Through
Tuesday's close, they had fallen 67% in the past 12 months.
The offshore driller said in February that it planned four
installments of 15 cents each, which represented an 80% reduction
from the previous payout rate, citing its "cyclical and
capital-intensive industry."
Transocean said Tuesday that it will seek shareholder approval
of the cancellation at an Oct. 29 meeting. The company is also
seeking a par value reduction of its shares to address expected
capital losses. It expects to record impairment charges for
investments in affiliates "in light of the deterioration of the
offshore drilling market and concerns regarding the timing of the
market's recovery."
In August, Transocean said its second-quarter revenue fell 19%
to $1.88 billion.
On Monday, Moody's Investors Service placed the ratings of 11
offshore drillers including Transocean under review for downgrade.
The rating firm said contractors "will face an extremely
challenging operating environment through at least 2017."
In May, BP PLC agreed to settle its remaining claims with
Transocean and Halliburton Co. over the 2010 Deepwater Horizon oil
spill, with which all three companies had involvement.
Write to Josh Beckerman at josh.beckerman@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
August 25, 2015 17:32 ET (21:32 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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