Transocean Ltd. Board of Directors Concludes Carl Icahn's Proposed Dividend and Director Nominees Are Contrary to the Best

Transocean Ltd. Board of Directors Concludes Carl Icahn's Proposed Dividend and 
Director Nominees Are Contrary to the Best Interests of
ZUG, SWITZERLAND -- (Marketwire) -- 03/17/13 --  Transocean Ltd.
(NYSE: RIG) (SIX: RIGN) today announced that its Board of Directors
has reviewed the proposals submitted by certain Funds affiliated with
Carl Icahn for vote at its 2013 Annual General Meeting of
Shareholders. Mr. Icahn proposed a dividend of $4.00 per share and
nominated three candidates (John J. Lipinski, Jose Maria Alapont and
Samuel Merksamer) for election to Transocean's Board of Directors.
Mr. Icahn also submitted a proposal to repeal the company's staggered
board structure. 
The Board has determined that Mr. Icahn's dividend proposal is in
direct conflict with Transocean's disciplined capital allocation
strategy, which includes maintaining a strong, flexible balance sheet
and an investment grade rating on its debt; disciplined, high-return
investment in the business; and the distribution of excess cash to
shareholders. Specifically, the Board believes the dividend proposed
by Mr. Icahn would adversely affect the company's ability to operate
and compete effectively in a cyclical and capital-intensive industry.
Further, the election of Mr. Icahn's candidates -- who are
hand-picked to pursue his potentially damaging short-term agenda --
is not in the best interest of the company and all of its
The company issued the following statement upon the Board's full
review of the proposals:  
Following its review and in light of these proposals, the Board
believes Mr. Icahn is pursuing a highly flawed agenda focused
exclusively on potentially generating temporary returns at the
expense of the company's ability to operate successfully and create
sustainable value over the long-term. His agenda ignores the cyclical
and capital-intensive nature of the offshore drilling industry and is
entirely contradictory to Transocean's strategy of driving long-term
shareholder value through operational excellence and a responsible,
balanced allocation of capital.  
The Board's recommendations with respect to Mr. Icahn's proposals are
as follows: 
Following the Board's review 
of Mr. Icahn's proposals, the Board is
confident that its proposed $2.24 per share dividend, or
approximately $800 million in the aggregate, will maximize long-term
value creation and, importantly, establishes a basis that is
sustainable and supports future dividend increases as business
conditions warrant.  
Mr. Icahn's assertion that Transocean's capital allocation strategy
"should manifest itself in a target of a permanent dividend that
approaches a minimum of 85% of net income" provides clear evidence of
his lack of understanding of the cyclical and capital-intensive
nature of the offshore drilling industry and the uncertainties that
exist today at the company. While Transocean's $2.24 per share
proposal would represent one of the industry's highest payout ratios
and dividend yields, Mr. Icahn's dividend proposal deviates
significantly from a responsible level -- as evidenced by the lower
payout ratios throughout the offshore drilling industry. Further, his
proposal is entirely inconsistent with the company's important goal
-- which is in the best interest of all its stakeholders -- of
maintaining its investment grade rating by retiring debt to achieve
leverage targets that are appropriate for it to operate successfully
over the long-term and make necessary investments in its business.  
The Board believes that distributing additional capital to
shareholders in the current context of uncertainties related to the
Macondo well incident, the Frade field incident in Brazil, and the
ongoing tax litigation in Norway would be detrimental to long-term
shareholder value. In the future, additional returns of capital may
be appropriate once these uncertainties are further resolved. 
Mr. Icahn has also suggested that the company's investment in its
fleet is an inappropriate allocation of capital. This suggestion
highlights Mr. Icahn's destructive short-term objectives. The
profitable addition of new, state-of-the-art drilling rigs is
essential for the long-term competitiveness of the company and
represents its primary source of growth and future operating income.
Discontinuing disciplined investment in high-return assets would
compromise the company's long-term viability.  
The Board is focused on a balanced capital allocation strategy and
does not intend to take steps that will threaten the company's
long-term performance, operating flexibility and investment grade
credit rating. Mr. Icahn's proposal for a $4.00 per share dividend
would reduce the company's financial flexibility and, as such, the
Board recommends a $2.24 per share dividend with the goal of future
increases should business conditions warrant.  
The company is confident that its Board is comprised of professionals
with the essential financial, operational, managerial, and corporate
governance expertise necessary to continue to successfully oversee
the execution of the company's operating and capital allocation
strategies. Transocean's Board includes 13 highly-qualified directors
with diverse perspectives on the industry, most of whom are
independent, and all of whom are proven business leaders with a broad
and deep range of leadership experience in, variously, oilfield and
offshore drilling services, finance, manufacturing, law, health,
safety and environment, or other areas crucial to the company's
Mr. Icahn's three candidate nominees are either employed by Mr.
Icahn, or are associated currently or in the past with entities in
which he has a significant interest and, as such, appear to be
selected by Mr. Icahn to pursue only his short-term objectives. Two
of his nominees have no oil and gas experience and none have worked
in the offshore drilling industry. Furthermore, Transocean's
management and the Board include individuals with substantial
expertise in devising and implementing appropriate corporate and
financing structures. 
Transocean's approach to corporate governance is to regularly infuse
fresh perspectives into an experienced and knowledgeable Board. In
this regard, six of the 12 independent directors have been added to
the Board in the last two years. Furthermore, the company believes
that the addition of Frederico F. Curado will benefit the Board's
decision-making process as a result of his significant senior
management experience at a global aerospace corporation, including
his experience with Brazilian business and governmental sectors -- an
important region of operations for the company.  
Mr. Icahn is attempting to include on the Board his longtime allies
or employees who have been nominated solely to execute his strategy
without consideration for industry expertise, independence or the
best interest of the company and all of its stakeholders. 
The Transocean Board is committed to acting in the best interests of
all its stakeholders, and firmly believes its strategies will better
position the company to maximize long-term value and generate
superior returns. In the context of a cyclical and capital-intensive
industry, the Board is focused on driving these returns through the
execution of the company's disciplined capital allocation strategy.  
As a result of the company's adherence to this strat
egy, Transocean
has maintained its investment grade rating throughout the challenging
period following the April 2010 Macondo incident. The company has
also profitably strengthened its industry-leading position in
high-specification floaters and jackups through the addition of four
new rigs over the past two years, growing its highly competitive
fleet which is equipped to operate in some of the world's most
challenging environments.  
As announced in late 2012, Transocean is also investing in four
contract-backed, state-of-the-art, ultra-deepwater drillships which
will provide additional revenue growth and a favorable return on the
company's investment when they are delivered beginning in 2015. In
addition, the company currently has two ultra-deepwater drillships
and three high-specification jackups under construction and sees
additional opportunities for similar, value-enhancing investments.  
Furthermore, since 2000, and including its currently proposed
dividend and cash distributed in connection with the 2007 merger with
GlobalSantaFe Corporation, Transocean will have returned more than
$20.5 billion in cash to shareholders in the form of distributions
and share repurchases. The company will continue to deploy capital in
ways that generate the best return for all of its stakeholders. 
The Board looks forward to continuing a strategy based on maintaining
a strong, flexible balance sheet; disciplined, high-return investment
in the business; and sustainable return of capital with the goal of
future increases should the previously stated uncertainties be
further resolved and business conditions warrant. 
With respect to Mr. Icahn's proposal to amend the company's articles
to de-classify the Board, the Board of Directors believes that there
are valid arguments both for and against staggered boards. Thus, the
Board does not make a voting recommendation to shareholders on this
Important Additional Information 
The company, its directors and certain of its executive officers and
employees may be deemed to be participants in the solicitation of
proxies from shareholders in connection with the company's 2013
Annual General Meeting (the "2013 Annual General Meeting"). The
company plans to file a proxy statement with the SEC in connection
with the solicitation of proxies for the 2013 Annual General Meeting
(the "2013 Proxy Statement"). SHAREHOLDERS ARE URGED TO READ THE 2013
INFORMATION. Additional information regarding the identity of these
potential participants, none of whom owns in excess of 1 percent of
the company's shares, and their direct or indirect interests, by
security holdings or otherwise, will be set forth in the 2013 Proxy
Statement and other materials to be filed with the SEC in connection
with the 2013 Annual General Meeting. This information can also be
found in the company's definitive proxy statement for its 2012 Annual
General Meeting (the "2012 Proxy Statement"), filed with the SEC on
April 6, 2012. To the extent holdings of the company's securities
have changed since the amounts printed in the 2012 Proxy Statement,
such changes have been or will be reflected on Statements of Change
in Ownership on Form 4 filed with the SEC. Shareholders will be able
to obtain, free of charge, copies of the 2013 Proxy Statement and any
other documents, including the WHITE proxy card, filed by the company
with the SEC in connection with the 2013 Annual General Meeting at
the SEC's website (, or at the company's website
(, or by contacting the company by email at In addition, copies of the proxy materials, when
available, may be requested from the company's proxy solicitor,
Innisfree M&A Incorporated, 501 Madison Avenue, 20th Floor, New York,
NY 10022.  
Forward-Looking Statements 
Statements included in this news release including, but not limited
to, those regarding the proposed dividend, the company's capital
allocation strategy, value-creating objectives and sustainability of
potential future distributions, are forward-looking statements that
involve certain assumptions and uncertainties. These statements are
based on currently available competitive, financial, and economic
data along with our current operating plans and involve risks and
uncertainties including, but not limited to, shareholder approval,
market conditions, Transocean's results of operations, the effect and
results of litigation, assessments and contingencies, and other
factors detailed in "Risk Factors" in the company's most recently
filed Annual Report on Form 10-K, and elsewhere in Transocean's
filings with the Securities and Exchange Commission. Should one or
more of these risks or uncertainties materialize (or the other
consequences of such a development worsen), or should underlying
assumptions prove incorrect, actual outcomes may vary materially from
those expressed or implied by such forward-looking statements.
Transocean disclaims any intention or obligation to update publicly
or revise such statements, whether as a result of new information,
future events or otherwise.  
About Transocean
 Transocean is a leading international provider of
offshore contract drilling services for oil and gas wells. The
company specializes in technically demanding sectors of the global
offshore drilling business with a particular focus on deepwater and
harsh environment drilling services, and believes that it operates
one of the most versatile offshore drilling fleets in the world. 
Transocean owns or has partial ownership interests in, and operates a
fleet of, 82 mobile offshore drilling units consisting of 48
High-Specification Floaters (Ultra-Deepwater, Deepwater and
Harsh-Environment drilling rigs), 25 Midwater Floaters and nine
High-Specification Jackups. In addition, we have six Ultra-Deepwater
Drillships and three High-Specification Jackups under construction. 
For more information about Transocean, please visit the website 
Analyst Contacts: 
Thad Vayda
+1 713-232-7551 
Diane Vento
+1 713-232-8015 
Media Contact: 
Guy A. Cantwell
+1 713-232-7647 
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