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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 1-7746 72-0464968
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation) File Number) Identification No.)
4 GREENWAY PLAZA
HOUSTON, TEXAS 77046
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (713) 871-7500
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ITEM 5. OTHER EVENTS
In September 1996, the Company acquired approximately 94 percent of
the outstanding capital shares of Transocean ASA, a Norwegian joint stock
company, in an exchange offer for shares of common stock of the Company and cash
(the "Combination"). The purchase price for the shares of Transocean ASA
acquired in the Combination consisted of approximately 22.9 million shares of
common stock of the Company and approximately $207 million in cash. During
November and December 1996, the Company acquired additional shares of Transocean
ASA for approximately $91 million in cash, bringing its total ownership of
Transocean ASA to over 99 percent. The Combination was deemed effective for
accounting purposes as of September 1, 1996.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(b) Pro forma financial information
The following Unaudited Condensed Pro Forma Combined Statement of
Operations for the year ended December 31, 1996 gives effect to (i) the
Combination and the subsequent acquisition of Transocean ASA shares and (ii) the
related financing transactions, as described in the Notes to the Unaudited
Condensed Pro Forma Combined Statement of Operations, applying U.S. GAAP under
the purchase method of accounting. The financial statements of Transocean ASA
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 Statement of Operations). The purchase price allocation has
been determined based on preliminary estimates of fair values and is subject to
change. The Unaudited Condensed Pro Forma Combined Statement of Operations for
the year ended December 31, 1996 was prepared as if the Combination were
consummated as of January 1, 1996 and is based on the historical consolidated
financial statements of the Company and Transocean ASA, giving effect to the
Combination under the assumptions and adjustments outlined in the accompanying
Notes to the Unaudited Condensed Pro Forma Combined Statement of Operations.
The Unaudited Condensed Pro Forma Combined Statement of Operations is
provided for illustrative purposes only and does not purport to represent what
the results of operations of the Company would actually have been if the
Combination had in fact occurred on the date indicated or to project the 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 Statement of Operations to any
such benefits. The Unaudited Condensed Pro Forma Combined Statement of
Operations should be read in conjunction with the notes thereto and (i) the
historical consolidated financial statements of the Company and the notes
thereto included in the Company's Annual Report on Form 10-K for the year ended
December 31, 1996 and (ii) the historical consolidated financial statements of
Transocean ASA included in the Company's Registration Statement on Form S-4
(Reg. No. 333-09105), each as filed with the Securities and Exchange Commission.
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UNAUDITED CONDENSED PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
------------------------- ---------------------------
COMPANY TRANSOCEAN ADJUSTMENTS COMBINED
--------- -------------- ----------- ----------
(U.S. Dollar amounts in thousands, except per share amounts)
<S> <C> <C> <C> <C> <C>
Operating Revenues $528,903 $256,351 $785,254
- ------------------------------------------------------------------------------------------------------
Costs and Expenses
Operating and Maintenance 351,569 177,436 529,005
Depreciation and Amortization 46,587 31,506 22,702(a) 100,795
General and Administrative 23,133 21,028 44,161
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421,289 229,970 22,702 673,961
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Operating Income 107,614 26,381 (22,702) 111,293
Other Income (Expense), Net 14,038 (32,243) (11,508)(b) (29,713)
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Income (Loss) from Continuing Operations
Before Taxes 121,652 (5,862) (34,210) 81,580
Income Taxes 43,607 64 (14,025)(c) 29,646
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Income (Loss) from Continuing Operations $ 78,045 $ (5,926) $(20,185) $ 51,934
======================================================================================================
Income (Loss) from Continuing Operations
per Common Share $ 2.17 $ (0.11) $ 1.01
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Weighted-Average Shares Outstanding 35,943 53,343 51,398(d)
======================================================================================================
</TABLE>
See accompanying notes to the Unaudited Condensed Pro Forma Combined Statement
of Operations.
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NOTES TO UNAUDITED CONDENSED PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
1. BASIS OF PRESENTATION
The Unaudited Pro Forma Combined Statement of Operations was prepared
applying U.S. GAAP and is presented assuming the Combination occurred as of
January 1, 1996. The pro forma purchase price allocation is based on a total
purchase price, including direct transaction costs, of $1,504.7 million. A
total of 22,920,840 shares of Company common stock and $207.4 million in cash
was delivered by the Company in exchange for the tendered Transocean ASA shares
pursuant to the exchange offer completed in September 1996. The value of the
Company common stock issued to Transocean ASA stockholders was calculated based
on $52.75 per share, 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 offering price was announced. In addition, $91.2
million, or $28.74 per share, was paid for the remaining shares of Transocean
ASA acquired in November and December 1996.
The historical financial statements of Transocean ASA have been converted
from Norwegian GAAP to U.S. GAAP and translated into U.S. dollars for purposes
of this presentation using the weighted-average rate of exchange for Norwegian
kroner ("Nkr") for the eight-month period ended August 31, 1996 of $1.00 = Nkr
6.447. The results of operations of Transocean ASA subsequent to September 1,
1996 are included in the consolidated results of the Company. Certain
reclassifications have been made to conform the Transocean ASA historical
financial statements to the pro forma presentation. Such reclassifications have
no effect on net income (loss) from continuing operations.
2. PRO FORMA ADJUSTMENTS
(a) To record additional depreciation expense of $9.8 million and amortization
of goodwill of $12.9 million. The excess of the purchase price over the
estimated fair value of net assets acquired is assumed to result in
approximately $768.1 million of goodwill. The purchase price allocation is also
assumed to include an increase in the value of drilling and other property and
equipment of approximately $395.6 million. 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.
(b) To adjust interest expense to account for the borrowing of approximately
$300 million under the Secured Credit Agreement dated as of July 30, 1996 among
the Company and the members of a banking syndicate led by ABN AMRO Bank, N.V.,
assuming such financing was obtained as of January 1, 1996, to fund the cash
portion of the acquisition price of the shares of Transocean ASA. Interest
expense has been calculated using an interest rate of 5.87 percent, based on the
average 1-month LIBOR rate for the eight months ended August 31, 1996 plus a
margin of .35% and assuming principal repayments of $27 million over the pro
forma period as required by the Secured Credit Agreement.
(c) To record income tax benefit on the historical Transocean ASA loss from
continuing operations before taxes and the effect of the pro forma adjustments
to depreciation, amortization and interest expense using a tax rate of 35
percent.
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(d) Weighted-average shares outstanding as if the 22.9 million shares of
common stock issued by the Company in consideration of the Transocean ASA shares
had taken place on January 1, 1996.
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SIGNATURES
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.
Date: April 2, 1997 By: /s/ Barbara S. Koucouthakis
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Barbara S. Koucouthakis
Vice President and Controller
