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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: RWS who wrote (67382)	5/31/2000 2:11:00 PM
From: Big Dog	Read Replies (2) \| Respond to of 95453

HOUSTON--(BUSINESS WIRE)--May 31, 2000--Diamond Offshore Drilling, Inc. (NYSE:DO - news) today announced plans to begin a private placement of 20-year zero coupon convertible debentures with proceeds of approximately $300 million. The company expects the offering to commence today with a closing next week. The company intends to use the net proceeds from the financing for general corporate purposes. Dog comment: I saw that DO was trading oddly today. Some big blocks of 200,000, 300,000 shares crossed at about 42 1/2 then the price fell a buck or so. Now I see this press release and I am confused...what in the world does DO want with $300 million? They already have about $400 million in cash sitting around. Maybe they are shopping...??? That's the only reason that would make any sense to me. Zero coupon is a smart way of shopping...no interest payments for a gillion years. Shopping targets? Since DO is in the mud these days with its second generation floaters, I would think they would go for a sexier deepwater company. That would be either RIG or FLC. The $300 million here plus the $400 millin cash in the bank would go a long way to paying off some debt of either RIG or FLC. The result would be a fairly modestly leveraged company with a killer fleet. Stranger things have happened.... Let's keep an eye on DO and see what happens. big