-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, SJ8XdO9tuGv8IyPyFuUvYOYIKEPGogDxcWfM78d7bRpq/QgLle6HOn8yPJbsgVhR 3PZBGzRErOf/L5HqwsD2qQ== 0000950155-96-000098.txt : 19960919 0000950155-96-000098.hdr.sgml : 19960919 ACCESSION NUMBER: 0000950155-96-000098 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960520 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19960918 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: SONAT OFFSHORE DRILLING INC CENTRAL INDEX KEY: 0000314047 STANDARD INDUSTRIAL CLASSIFICATION: DRILLING OIL & GAS WELLS [1381] IRS NUMBER: 720464968 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-07746 FILM NUMBER: 96631793 BUSINESS ADDRESS: STREET 1: 4 GREENWAY PLAZA CITY: HOUSTON STATE: TX ZIP: 77046 BUSINESS PHONE: 7138717500 MAIL ADDRESS: STREET 1: 4 GREENWAY PLAZA CITY: HOUSTON STATE: TX ZIP: 77046 8-K 1 FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (date of earliest event reported): September 3, 1996 TRANSOCEAN OFFSHORE INC. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of incorporation) 1-7746 72-0464968 (Commission File Number) (IRS Employer Identification No.) 4 Greenway Plaza, Houston, Texas 77046 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (713) 871-7500 Sonat Offshore Drilling Inc. (Former name, if changed since last report) Item 2. Acquisition or Disposition of Assets On September 3, 1996, Transocean Offshore Inc., formerly known as Sonat Offshore Drilling Inc. (the "Company"), acquired 50,857,948 shares of Transocean ASA ("Transocean"), which constitutes approximately 94% of the outstanding Transocean shares. Such Transocean shares were acquired from the public shareholders of Transocean pursuant to an exchange offer (the "Exchange Offer") providing for consideration of 0.53 shares of Company common stock for each of 43,248,358 Transocean shares (subject to payment of cash in lieu of fractional shares) and $27.25 for each remaining Transocean share. A total of 22,920,840 shares of Company common stock and $207,405,228 in cash was delivered by the Company in exchange for the tendered Transocean shares pursuant to the Exchange Offer. The cash portion of such consideration was funded from the Company's available cash resources and borrowings under the Company's Secured Credit Agreement, dated as of July 30, 1996 (the "Credit Agreement"), among ABN Amro Bank N.V., Houston Agency, as Agent, Bank of Montreal, Houston Agency, The Fuji Bank Limited, Royal Bank of Canada and Wells Fargo Bank (Texas), National Association, as Co-Agents, and SunTrust Bank, Atlanta, and Credit Lyonnais, New York Branch, as Documentation Agents. Pursuant to the requirements of Norwegian law, the Company intends to commence in the near future an offer (the "Mandatory Offer") to acquire the remaining publicly-held Transocean shares for $28.74 per share in cash. Transocean, a Norwegian company based in Tananger, Norway, is a major offshore drilling company and also operates two other business segments: (i) oil and gas platform drilling and well intervention and (ii) oil services engineering and construction. In connection with the consummation of the foregoing acquisition, on September 3, 1996, the Certificate of Incorporation of the Company was amended to increase the authorized number of shares of Company common stock to 150,000,000 and to change the name of the Company to Transocean Offshore Inc. Item 7. Financial Statements and Exhibits (a) Financial statements of business acquired. The financial statements of Transocean for each of the three years ended December 31, 1995, and for the three-month periods ended March 31, 1996 and 1995, are filed as Exhibit 99.1 hereto. (b) Pro forma financial information. The following Unaudited Condensed Pro Forma Combined Balance Sheet as of June 30, 1996 and the Unaudited Condensed Pro Forma Combined Statements of Operations for the six-month period ended June 30, 1996 and the year ended December 31, 1995 have been prepared to illustrate the estimated effects of the combination of the Company and Transocean (the "Combination") pursuant to the Exchange Offer, the Mandatory Offer and the anticipated compulsory acquisition under Norwegian law (the "Compulsory Acquisition") of any remaining publicly-held Transocean shares applying U.S. GAAP under the purchase method of accounting. Allocations of purchase price have been determined based on preliminary estimates of fair values and are subject to change. The Unaudited Condensed Pro Forma Combined Balance Sheet as of June 30, 1996 was prepared as if the Combination were consummated on June 30, 1996. The Unaudited Condensed Pro Forma Combined Statements of Operations for the six-month period ended June 30, 1996 and the year ended December 31, 1995 were prepared as if the Combination were consummated as of January 1, 1995. The Unaudited Condensed Pro Forma Combined Financial Statements are based on the historical consolidated financial statements of the Company and Transocean giving effect to the Combination under the assumptions and adjustments outlined in the accompanying Notes to Unaudited Condensed Pro Forma Combined Financial Statements. The Unaudited Condensed Pro Forma Combined Financial Statements reflect a total purchase price, including direct transaction costs, of $1,497,632,000, which is calculated based on the average of the closing prices of Company common stock over the five-day period commencing two days before May 20, 1996, the date on which the revised offering price was announced, assuming 50,857,948 shares of Transocean Stock were exchanged for 22,920,840 shares of Company common stock and $207,405,288 in cash. In addition, it is assumed that $28.74 is paid for each remaining share of Transocean under the Mandatory Offer and any required Compulsory Acquisition. The Unaudited Condensed Pro Forma Combined Financial Statements have been prepared applying U.S. GAAP. The financial statements of Transocean have been converted from Norwegian GAAP to U.S. GAAP and translated into U.S. dollars for purposes of this presentation (see Note 1 to the Unaudited Condensed Pro Forma Combined Financial Statements). Norwegian GAAP differs in certain significant respects from U.S. GAAP. A reconciliation of net income (loss) and shareholders' equity of Transocean from Norwegian GAAP to U.S. GAAP is presented in Note 34 to the Consolidated Financial Statements of Transocean and Note 5 to the Condensed Consolidated Financial Statements of Transocean included as Exhibit 99.1 to this Report. The Unaudited Condensed Pro Forma Combined Financial Statements are provided for illustrative purposes only and do not purport to represent what the financial position or results of operations of the Company would actually have been if the Combination had in fact occurred on the dates indicated or to project the financial position or results of operations for any future date or period. Although the Company expects to realize cost reductions from the Combination, no effect has been given in the Company's Unaudited Condensed Pro Forma Combined Financial Statements to any such benefits. The Unaudited Condensed Pro Forma Combined Financial Statements should be read in conjunction with the notes thereto and the consolidated financial statements of the Company and Transocean and the related notes thereto contained in the Company's reports and registration statement filed with the Securities and Exchange Commission during 1996 prior to the date hereof. Unaudited Condensed Pro Forma Combined Balance Sheet As of June 30, 1996
Historical Pro Forma ------------------------ -------------------------- Company Transocean(1) Adjustments Combined ------- ------------- ----------- -------- (U.S. Dollar amounts in thousands) Cash and Cash Equivalents ..................... $ 60,431 $ 41,754 $ 314,445 (4) $ 102,185 (299,445)(2b) (6,000)(2c) (6,000)(3) (3,000)(5) Accounts and Notes Receivable ................. 72,894 80,366 153,260 Other Current Assets .......................... 28,661 18,335 46,996 --------- ---------- ----------- ----------- Total Current Assets ...................... 161,986 140,455 302,441 Property and Equipment, net ................... 370,229 488,422 414,478 (2e) 1,273,129 Goodwill and Intangibles ...................... 736,506 (2f) 736,506 Other Assets .................................. 42,301 21,977 3,000 (5) 67,278 --------- ---------- ----------- ----------- Total Assets .................................. $ 574,516 $ 650,854 $ 1,153,984 $ 2,379,354 ========= ========== ============ =========== Current Liabilities ........................... $ 62,491 $ 112,548 $ 27,000 (4) $ 202,039 Long-Term Debt ............................... 30,000 111,096 287,445 (4) 428,541 Deferred Taxes and Other Credits .............. 84,278 8,514 66,048 (2g) 158,840 Stockholders' Equity .......................... 397,747 418,696 (418,696)(2d) 1,589,934 1,198,187 (2a) (6,000)(3) --------- ---------- ----------- ----------- Total Liabilities and Stockholders' Equity .... $ 574,516 $ 650,854 $ 1,153,984 $ 2,379,354 ========= ========== ============ ===========
See accompanying notes to the Unaudited Condensed Pro Forma Combined Financial Statements. Unaudited Condensed Pro Forma Combined Statement of Operations For the Six Months Ended June 30, 1996
Historical Pro Forma ------------------------ ----------------------- Company Transocean(1) Adjustments Combined ------- ------------- ----------- ---------- (U.S. Dollar amounts in thousands, except per share amounts) Operating Revenues ..................... $ 190,101 $ 182,757 $ 372,858 --------- --------- --------- --------- Costs and Expenses Operating and Maintenance ......... 123,328 137,337 260,665 Depreciation and Amortization ..... 12,358 23,730 $ 11,233 (6) 47,321 General and Administrative ........ 10,230 15,771 26,001 --------- --------- --------- --------- 145,916 176,838 11,233 333,987 --------- --------- --------- --------- Operating Income ....................... 44,185 5,919 (11,233) 38,871 Other Income (Expense), Net ............ 13,221 27,840 (9,066)(7) 31,995 --------- --------- --------- Income (Loss) from Continuing Operations Before Taxes ...................... 57,406 33,759 (20,299) 70,866 Income Taxes ........................... 20,104 534 (3,106)(8) 17,532 --------- --------- --------- --------- Income (Loss) from Continuing Operations $ 37,302 $ 33,225 $ (17,193) $ 53,334 ========= ========= ========== ========= Income (Loss) from Continuing Operations per Common Share .................. $ 1.31 $ 0.62 $ 1.04 ========= ========= ========= Weighted Average Shares Outstanding .... 28,455 53,343 51,376(9) ========= ========= =========
See accompanying notes to the Unaudited Condensed Pro Forma Combined Financial Statements. Unaudited Condensed Pro Forma Combined Statement of Operations For the Year Ended December 31, 1995
Historical Pro Forma --------------------------- ------------------------------ Company Transocean(1) Adjustments Combined ------- -------------- ------------- -------- (U.S. Dollar amounts in thousands, except per share amounts) Operating Revenues.......................... $ 322,658 $ 348,112 $ 670,770 Costs and Expenses Operating and Maintenance.............. 222,367 268,259 490,626 Depreciation........................... 26,995 49,608 $ 24,812 (6) 101,415 General and Administrative............. 21,208 36,924 58,132 ----------- ------------ ------------ --------- 270,570 354,791 24,812 650,173 ----------- ------------ ------------ --------- Operating Income (Loss)..................... 52,088 (6,679) (24,812) 20,597 Other Income (Expense), Net................. 23,061 7,337 (19,360)(7) 11,038 ----------- ------------ ------------ --------- Income (Loss) from Continuing Operations Before Taxes........................... 75,149 658 (44,172) 31,635 Income Taxes................................ 28,201 405 (7,213)(8) 21,393 ----------- ------------ ------------ --------- Income from Continuing Operations........... $ 46,948 $ 253 $ (36,959) $ 10,242 =========== ============= ============ ========= Income from Continuing Operations per Common Share........................... $ 1.65 $ 0.01 $ 0.20 =========== ============= ======== Weighted Average Shares Outstanding......... 28,374 52,550 51,295(9) =========== ============= ========
See accompanying notes to the Unaudited Condensed Pro Forma Combined Financial Statements. Notes to Unaudited Condensed Pro Forma Combined Financial Statements (1) The Unaudited Condensed Pro Forma Combined Financial Statements have been prepared applying U.S. GAAP. The financial statements of Transocean have been converted from Norwegian GAAP to U.S. GAAP and translated into U.S. dollars for purposes of this presentation at a rate of $1.00 = Nkr 6.501 as of June 30, 1996 and using the weighted average rates of exchange for the six-month period ended June 30, 1996 and for the year ended December 31, 1995 of $1.00 = Nkr 6.464 and 6.329, respectively. Norwegian GAAP differs in certain significant respects from U.S. GAAP. A reconciliation of net income (loss) and shareholders' equity of Transocean from Norwegian GAAP to U.S. GAAP is presented in Note 34 to the Consolidated Financial Statements of Transocean and Note 5 to the Condensed Consolidated Financial Statements of Transocean included as Exhibit 99.1 to this Report. Certain reclassifications have been made to conform the Transocean historical financial statements to the pro forma presentation. Such reclassifications have no effect on total stockholders' equity or net income (loss) from continuing operations. (2) To reflect the purchase of 100% of the outstanding shares of Transocean for a total consideration of $1,497,632,000, assuming 50,857,948 shares of Transocean were exchanged for 22,920,840 shares of Company common stock and $207,405,228 in cash. In addition, it is assumed that $28.74 will be paid for each remaining share of Transocean under the Mandatory Offer and any required Compulsory Acquisition. The value of Company common stock issued in the Combination was calculated based on $52.275, which was the average of the closing prices of Company common stock over the five-day period commencing two days before May 20, 1996, the date on which the revised offer was announced. ($ in thousands) ---------------- (a) Company common stock issued............. $1,198,187 (b) Cash consideration paid................. 299,445 ---------- Total consideration to be paid....... 1,497,632 (c) Direct transaction costs................ 6,000 ---------- Total purchase price................. $1,503,632 ========== The purchase price will be allocated based upon estimated fair values of the Transocean assets and liabilities. For purposes of the Unaudited Condensed Pro Forma Combined Financial Statements, the purchase price has been allocated as follows: ($ in thousands) ---------------- (d) Historical net book value of Transocean............................. $ 418,696 (e) Fair value adjustment of property and equipment, net..................... 414,478 (f) Excess of purchase price over the sum of fair value of identifiable assets acquired less liabilities assumed................................ 736,506 (g) Adjustment for related deferred income taxes payable.......................... (66,048) ---------- Total purchase price.................. $1,503,632 ========== (3) To record costs directly associated with the issuance of Company common stock. (4) To record financing obtained in connection with the Combination including $15 million of related costs, consisting of $6 million in direct transaction costs, $6 million in costs directly associated with the issuance of Company common stock, and $3 million in debt refinancing costs. (5) To record costs directly associated with financing obtained in connection with the Combination. (6) To record additional depreciation expense and amortization of goodwill resulting from the allocation of the purchase price. The pro forma adjustment assumes estimated remaining useful lives ranging from 6 to 24 years for depreciation and a 40-year amortization period for goodwill. (7) To adjust interest expense, including amortization of debt issuance costs, assuming that the additional financing was obtained as of January 1, 1995. Interest expense has been calculated using an interest rate of 6.056%, based on the 3-month LIBOR rate of 5.656% as of September 12, 1996 plus a margin of .40% and assumes principal repayments of $40.5 million over the pro forma period as required by the Credit Agreement. A one-half percent change in interest rates would impact interest expense in the amount of approximately $2 million over the 18-month pro forma period. (8) To record income tax expense on the effect of the pro forma adjustments to depreciation and interest expense. The Norwegian statutory income tax rate of 28% has been used. Goodwill amortization has been treated as a permanent difference for income tax purposes; therefore, it does not give rise to an income tax effect. (9) Weighted average shares outstanding as if the 22.9 million shares to be issued by the Company in consideration of the Transocean shares had taken place on January 1, 1995. (c) Exhibits. The Index to Exhibits to this Report is incorporated herein by reference. SIGNATURE ----------- Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. TRANSOCEAN OFFSHORE INC. By /s/ Robert L. Long ------------------------- Date: September 18, 1996 Robert L. Long Senior Vice President INDEX TO EXHIBITS Exhibit No. Description - ----------- ----------- 23.1 Consent of Coopers & Lybrand ANS -- filed herewith 99.1 Report of Coopers & Lybrand ANS and Consolidated Financial Statements of Transocean for each of the three years ended December 31, 1995 and (unaudited) for the three-month periods ended March 31, 1996 and 1995 -- incorporated by reference from pages F-29 through F-77, inclusive, of the Company's Registration Statement on Form S-4 (No. 333-09105) EX-23.1 2 CONSENT OF INDEPENDENT ACCOUNTANTS CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference into the Registration Statement on Form S-8 (File No. 33-64776) and Form S-8 (File No. 33-66036) of Transocean Offshore Inc. (formerly Sonat Offshore Drilling Inc.) of our report dated June 15, 1996, except as to the information presented in Note 33, for which the date is July 26, 1996 contained in the Registration Statement of Sonat Offshore Drilling Inc. on Form S-4 (No. 333-09105), on our audits of the financial statements of Transocean ASA and Subsidiaries as of December 31, 1995, 1994 and 1993. We also consent to the inclusion in the prospectus documents relating to such Registration Statements of a statement that the foregoing consolidated financial statements of Transocean ASA and Subsidiaries have been incorporated by reference in such Registration Statements in reliance on our report and upon the authority of our firm as experts in accounting and auditing. COOPERS & LYBRAND ANS Oslo, Norway September 18, 1996 -----END PRIVACY-ENHANCED MESSAGE-----