HOUSTON, March 7 Billionaire investor Carl Icahn
piled more pressure on Transocean Ltd, saying the
offshore driller's mergers were "ill-advised" and its
development strategies "unsuccessful," and urged investors to
vote for a dividend of $4 per share.
The activist investor has been campaigning for a higher
payout for over a month, and is calling for major changes to the
Switzerland-based company's board ahead of its annual meeting on
Transocean recommended on Sunday that shareholders approve a
$2.24 per share dividend, and had earlier on Thursday defended
its 13 "highly qualified directors" as it confirmed receipt of
"Over the past several years ... the company has conducted
ill-advised mergers, employed unsuccessful development
strategies and squandered the substantial cash flow generated by
the business," Icahn wrote in an open letter to Transocean
shareholders on Thursday.
A spokesman for Transocean did not have an immediate comment
on the letter.
Transocean grew out of a series of mergers that started with
the purchase by Birmingham, Alabama-based Sonat Offshore
Drilling of Norway's Transocean ASA in 1996. Three years later
came the takeover of Sedco Forex, spun off by oil services giant
Schlumberger, before a blockbuster deal with
GlobalSantaFe in 2007 created an industry leader.
Icahn, who owns 5.61 percent of Transocean, wants the
company to replace its directors, including the chairman. He
requested shareholders to vote for his nominees, John Lipinski,
José Maria Alapont and Samuel Merksamer.
Icahn is having a busy start to 2013. He also published a
letter to Dell Inc on Thursday to oppose the computer
maker's go-private deal and is seeking a $15.7 billion special
dividend. Last week, Herbalife Ltd said
it would add two Icahn-picked directors to its
Transocean responded to Icahn's dividend demand by saying
said it was confident its proposed payout would maximize
long-term value creation in what is a "cyclical and
"The Board believes that, in the context of the
uncertainties the company currently faces, a larger dividend
would be overly aggressive and detrimental to the company's
long-term performance," the company said in a statement.
Transocean shares were up 9 cents at $53.54 in morning