Transocean Ltd. said Monday that J. Michael Talbert plans to retire as chairman of the oil drilling company's board by November. The move comes amid intense pressure on Transocean from billionaire investor Carl Icahn, who is seeking shareholder approval for his own slate of board nominees and a higher dividend from the company.
Transocean, based in Switzerland, owned the Deepwater Horizon drilling rig which exploded and sank in the Gulf of Mexico in 2010, triggering a massive offshore oil spill. The company recently reached an agreement with the Justice Department over its role in the massive oil spill.
Icahn, who holds a 5.6 percent stake in the company, is seeking several changes. He is asking shareholders to vote this week on his slate of three board nominees, a proposal to repeal the company's staggered board and support for his push for a $4 per share dividend.
Icahn, known for shaking up companies, has previously said that Transocean must replace the board members that helped created its "failed capital allocation strategy", including Talbert.
Talbert said in a statement that he decided to retire after consultations with shareholders. He served as CEO of the company from 1994 to 2002 and has been on its board since 1994. Talbert is currently in his third term as chairman of the company's board.
The company said Monday that Talbert has decided that if he is re-elected at the company's annual meeting on Friday that he will retire from the board no later than the company's annual meeting in 2014. He plans to step down as chairman by November.
Transocean is against Icahn's higher dividend, saying it is overly aggressive and detrimental to the company's long-term performance. It also opposes Icahn's board nominees, citing distinct issues with each; including inexperience, a past criminal indictment and prior performance concerns.
Icahn said in a letter to shareholders that it is "utterly absurd" that Talbert should ask shareholders to return him to his seat, so he and the board can pick his successor. Icahn said Talbot and other board members are "incapable of delivering returns" and therefore, should be replaced and shareholders should have a say in who replaces them.
Transocean spokesman Brian Kennedy said that that Talbert would not serve on the nominating committee for a replacement and said Icahn has mischaracterized the board's record of corporate governance.
"Taken collectively, it's clear to us that Mr. Icahn is more interested in a quick buck than in the long-term health and viability of the company," Kennedy said in an emailed statement. "He has failed to bring forward any intelligent or coherent plan for Transocean beyond a short-term extraction of cash and a woefully unqualified slate of board nominees."
Transocean fell 14 cents to close at $54.50. The stock has traded in a 52-week range of $39.32 to $59.50.