Transocean, the world's largest offshore driller for oil and natural gas, will spin off its Gulf of Mexico shallow- and inland-water drilling unit to raise cash and pare debt.
Transocean plans to sell a stake in the unit in an initial stock offering in late 2002 or early 2003, spokesman Guy Cantwell said, and will focus on deep water drilling. The company had $4.44 billion in long-term debt at March 30th.
The Houston based Transocean acquired the unit when it bought rival R&B Falcon Corp. for $6.78 billion in 2001. In a regulatory filing this year, the company said that it did not view the operation “as a long-term integral part” of its business.
“The surprise is the timing (of the spinoff) in this market, as far as getting the right price in an IPO when equities are down,” said S. Magnus Fyhr, an oil service analyst at Jeffries & Co. who estimated the unit's value at about $900 million.