Rig Owner Transocean Gets Pimco Default Notice on Its Bonds (1)

Transocean Ltd. bondholders Pacific Investment Management Co. and Whitebox delivered a notice of default and moved to demand immediate repayment of debt by the world’s biggest owner of deep-water oil rigs.

Funds managed by or affiliated with Pimco and Whitebox, which hold a combined 25% of Transocean bonds due in 2027, claim the company violated the terms of the notes because subsidiaries created under an internal reorganization don’t guarantee the notes, according to a filing Tuesday. Transocean said it “strongly disagrees with the assertion” and “believes the allegation is meritless.”

Offshore rig contractors like Transocean have struggled during the ...