Transocean Raising Cash?

Drill rig operator Transocean Ltd. (NYSE: RIG) this morning announced the sale 38 of its shallow-water drilling rigs to a consortium of private equity firms called Shelf Drilling International Holdings Ltd. for $1.05 billion in cash and preferred shares. The cash portion of the deal is worth $855 million to Transocean.

In its announcement, Transocean’s president/CEO said:

This agreement marks an important milestone in our asset strategy to increase our focus on high-specification floaters and jackups, improving our long-term competitiveness.

Well maybe. The press release also notes that the company will take an impairment charge on long-lived assets or goodwill allocatable to these assets in its third fiscal quarter. Transocean wrote down $5.2 billion in goodwill in September last year, dropping the company’s current goodwill total to around $3.1 billion, a portion of which “is expected to be allocated to the assets” Transocean sold today. Those assets have a carrying value of $1.4 billion, and the company said that the sales price includes “approximately $200 million related to the net current assets associated with the transactions.”

Transocean’s share price was around $160 in mid-2008 and around $90 before the company’s Deepwater Horizon exploded in April 2010 killing 11 workers and dumping millions of barrels of crude into the Gulf of Mexico. Transocean last month added $750 million to the $1 billion it had already set aside for potential losses in the fourth quarter of 2011.

The company is also the subject of a drilling ban in Brazil, where a leaking well owned by Chevron Corp. (NYSE: CVX) led the government to file an injunction against both companies. Transocean has 10 active rigs in Brazil out of a total of 127 active rigs before today’s sale.

Shares of Transocean are up about 1.5% in premarket trading this morning, at $48.30 in a 52-week range of $38.21 to $60.09.

Paul Ausick