Carl Icahn Issues Open Letter to Transocean Shareholders

Carl C. Icahn today delivered the following open letter to shareholders of Transocean Ltd. Dear Fellow Shareholders of Transocean: Today we delivered a formal letter to Transocean Ltd. informing them that I will be including the following items on the agenda at the Company's 2013 Annual General Meeting of Shareholders: • A proposal to approve a $4 dividend per share to be paid in four equal quarterly installments, • To elect three new directors, John J. Lipinski, José Maria Alapont and Samuel Merksamer, to the Board, and • A proposal to repeal the Company's staggered board. I am proposing the $4 dividend because I believe that a high dividend payout ratio is the only way that Transocean will consistently employ a disciplined and sensible approach to capital allocation. Over the past several years, in my opinion, the Company has conducted ill-advised mergers, employed unsuccessful development strategies and squandered the substantial cash flow generated by the business. Now, it appears to me, the Board and management would like to take the Company's substantial cash flow and use it to achieve three goals: the massive repayment of the company's low coupon debt, the aggressive new build growth locked up with low return contracts, and the payment of a meager dividend to shareholders. I believe that the inability of Transocean to grow and pay down debt is a function of poor capital allocation which has driven the share price to below net asset value. Once the capital allocation problem has been solved, in my opinion, Transocean will have access to yield hungry investors to finance growth and acquisitions on attractive terms. I believe that to permanently repair the failed capital allocation strategy, shareholders of this Company must replace the directors who have been the architects of this failed strategy, including the Chairman. The directors that I have chosen have substantial experience in the creation and issuance of non-traditional yield structures, driving shareholder returns through capital allocation, and managing and growing large corporations both internationally and in the energy sector. If these nominees are elected, which I expect they will be, I truly believe it will serve shareholders well.