Each one in plain English, with the numbers worked through for a shareholder.
4 May 2012business combination● NeutralMajor
This is the same May 4, 2012 report as the Rowan UK filing, filed under the old Delaware company's name: the merger moving the parent to the UK took effect at 12:01 a.m. Eastern. Rowan UK became a borrower and guarantor under the 2010 credit agreement and guaranteed the 5% 2017 and 7.875% 2019 senior notes. Rowan Delaware asked the NYSE to remove its common stock from listing (Form 25) as the ordinary shares began trading as RDC, and Rowan Delaware's officer change-in-control agreements were supplemented so they refer to ownership of Rowan UK. Rowan UK then expects to file a Form 15 to end registration of the Delaware stock.
The move to the UK was completed at 12:01 a.m. Eastern on May 4, 2012: Rowan Companies plc became the parent and successor to Rowan Companies, Inc., after stockholders approved it on April 16. Each Delaware share was converted into the right to receive a Class A Ordinary Share of the UK company, one-for-one (via ADS that were cancelled immediately), and the ordinary shares trade on the NYSE as RDC. Rowan UK also became a borrower and guarantor under the 2010 credit agreement and guaranteed the 5% notes due 2017 and 7.875% notes due 2019, with no noteholder consent needed. This resolves the redomicile thread and the board chose the direct ordinary-share route floated on April 12.
Rowan furnished its routine monthly fleet status report as of April 25, 2012; the filing itself contains no other news. The report shows the Rowan Viking on a standby day rate until operations resume at the Elgin platform, and the Rowan Gorilla V suspending operations before repositioning to drill a relief well at Elgin for Total at a higher day rate (mid 200s). This follows the March 25 Elgin gas release; no financial impact is stated. It also repeats the Saudi Aramco late-delivery penalties on Rowan-Mississippi (about $21,000/day) and Bob Palmer (about $6,000/day), both under appeal.
Four days before the April 16 vote on moving to a UK parent, Rowan amended the merger agreement so the board may deliver Class A Ordinary Shares directly instead of American depositary shares (ADS), and said it now expects the merger to take effect in May 2012 rather than around April 18. This changes the earlier plan: the board may still deliver ADS as originally planned if the ordinary-share route does not work out. The filing also describes custody arrangements for record holders and UK stamp duty (0.5% on most transfers, 1.5% in certain cases) that could apply to ordinary shares not held through DTC, and warns that if DTC stopped serving the shares, listing and trading could be disrupted.
Rowan reported that a gas release occurred on March 25, 2012 on a Total E&P UK wellhead platform in the Elgin Field in the North Sea, where the Rowan Viking had been working; all Rowan and Total personnel were safely evacuated and Total is working to control the release. The attached monthly fleet status report is otherwise routine; it shows the Rowan Viking under contract to Total UK to January 2013, and the Rowan EXL IV mobilizing to Malaysia under a letter of award from Carigali Hess for about 31 months from May 2012. The filing gives no cost or financial impact from the incident.
Rowan filed its definitive proxy statement for a special stockholder meeting on April 16, 2012 to vote on the move to a UK parent. Holders of record at March 8 can vote on adopting the merger agreement (one share converts to one ADS representing one Class A Ordinary Share of Rowan UK), on takeover-style mandatory offer provisions, and on ending the classified board from 2013. The merger is expected to take effect around April 18, 2012 and needs a majority of outstanding shares. The filing says US holders should recognise gain, if any, but not loss, for US tax purposes. This follows the February announcement.
Rowan's board unanimously approved a plan to move the company's legal home from Delaware to the United Kingdom, and a merger agreement was signed on February 27, 2012. Each share of Delaware common stock would be exchanged one-for-one for an American depositary share representing a Class A Ordinary Share of a new English company, Rowan Companies plc; the ADS are expected to trade on the NYSE under RDC. Business and operations are to continue substantially as before. Completion needs stockholder approval and other consents, and is targeted for late spring 2012. The company says 81% of 2012 revenue is expected from non-U.S. operations.
Rowan furnished its routine monthly fleet status report as of February 27, 2012; the filing contains no other news. It lists rig contracts, day rates and shipyard plans, including the Rowan Norway starting a 240-day Xcite Energy term in early March 2012 and the continuing Saudi Aramco late-delivery penalties (about $21,000/day on Rowan-Mississippi, about $6,000/day on Bob Palmer), both under appeal.
Rowan furnished its routine monthly fleet status report as of February 2, 2012, listing rig contracts, day rates and shipyard plans; the filing itself contains no other news. The report shows three ultra-deepwater drillships under construction by HHI (Rowan Renaissance due late 2013, Resolute mid 2014, Reliance late 2014), and the Rowan Viking, Norway and Stavanger among the N-class jack-ups that came from SKDP. It also flags possible Saudi Aramco late-delivery penalties on two rigs (Rowan-Mississippi and Bob Palmer), which Rowan is appealing.
On September 1, 2011 Rowan closed the sale of its land drilling business (31 land rigs) to Ensign, receiving about $510 million cash at closing and expecting roughly $30 million more as a working capital adjustment. After-tax proceeds are estimated at about $370 million, to be redeployed into offshore drilling and the deepwater expansion. This completes the July agreement.
On July 19, 2011 Rowan agreed to sell its land drilling unit, Rowan Drilling Company (31 land rigs), to Ensign for $510 million cash plus working capital estimated at $30 million, subject to regulatory approval including US antitrust waiting-period expiry. After-tax proceeds of about $370 million are to go to offshore drilling and a newly announced deepwater expansion (two drillships, per the press release). This follows the LeTourneau sale as another sale of a non-offshore business.
28 June 2011asset acquisition disposition▲ GoodMajor
On June 22, 2011 Rowan completed the LeTourneau sale to Joy Global announced in May, receiving $1.1 billion in cash less a $54.3 million adjustment for a customer prepayment, with a further working capital adjustment to come. The attached pro forma figures estimate an after-tax gain of $432 million and pro forma cash of about $1.2 billion as at March 31, 2011; the manufacturing business is gone from the group.
On May 13, 2011 Rowan agreed to sell LeTourneau Technologies, its manufacturing arm (drilling, mining and timber equipment), to Joy Global for $1.1 billion in cash, subject to a working capital adjustment and regulatory approval. Management estimates after-tax proceeds of about $875 million and says most will ultimately go into offshore drilling, either more jack-ups or ultra-deepwater; the filing says there is no assurance the deal closes.
29 Nov 2010material agreement termination● Neutral
On November 24, 2010 Rowan redeemed the remaining SKDP bonds (the 11.25% bonds due 2013, in two series) at 106% of par, paying about $42.2 million for the SKDP 2 bonds (par ~$39.9m) and about $77.2 million for the SKDP 3 bonds (par ~$72.8m). It expects a combined $1.1 million loss on early repayment in Q4 2010, and put about $0.4 million and $3.6 million in escrow pending a bondholder claim that the bonds cannot be redeemed before their March 2011 and July 2011 call dates; Rowan says it expects to win and recover the escrowed money. This continues the clean-up of the SKDP debt taken on in the 2010 acquisition.
This amendment to the July 1 8-K only adds copies of the SKDP debt agreements as exhibits, but its text also updates the deal outcome. Rowan acquired the remaining SKDP shares for cash on September 30, 2010 via compulsory acquisition, and SKDP is delisted from the Norwegian OTC. Total consideration was about $13 million cash plus 11,724,818 Rowan shares. Of SKDP's ~$530 million debt at par, Rowan has bought back $141 million; the mandatory prepayment of debt secured by the Rowan Viking occurred November 1, 2010.
Rowan closed the SKDP purchase from the main sellers (5,697,663 Rowan shares for 992,335,567 SKDP shares). With exchange offer tenders it will hold about 97.16% of SKDP and plans a compulsory cash buyout of the rest and delisting. It also signed a new credit agreement (up to $250 million revolving through 2014 and $350 million term through 2015, the term part intended to refinance SKDP debt) and ended its $155 million 2008 credit agreement, which had nothing drawn. SKDP plans to sell its first rig (to be renamed Rowan Viking) to a Rowan Gibraltar subsidiary, triggering redemption of the debt secured by it at 108% of par (first lien) and 106% (second lien). Rowan also said it had bought about $80 million of SKDP debt in the open market.
