Derivative Financial Instruments

6 Months Ended

Jun. 30, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

Derivative Financial Instruments

Interest Rate Swaps

During 2014, the Company fixed the LIBOR portion of its US dollar denominated variable rate borrowings (Note 8) with interest rate swap derivative arrangements. The interest rate swaps with a notional value of $500 million expired on January 2, 2016.

Foreign Currency Forwards and Swaps

Gross notional values of the foreign currency forwards and swaps are as follows:

	As of June 30, 2016	As of December 31, 2015
	(In $ millions)
Total	536	502

Cross-currency Swaps

In March 2015, the Company settled its cross-currency swap agreements with notional values of $250 million/€193 million, expiring September 11, 2020, and $225 million/€162 million, expiring April 17, 2019, in exchange for cash of $88 million. The Company recorded a net loss of $1 million, which is included in Other income (expense), net in the unaudited interim consolidated statement of operations. The Company classifies cash flows from derivative instruments designated as cash flow hedges in the same category of the consolidated statement of cash flows as the cash flows from the items being hedged. Accordingly, the settlement of the cross-currency swap agreements is included in Net cash provided by (used in) operating activities in the unaudited interim consolidated statement of cash flows for the six months endedJune 30, 2015.

Information regarding changes in the fair value of the Company's derivative and non-derivative instruments is as follows:

	Gain (Loss) Recognized in Other Comprehensive Income (Loss)			Gain (Loss) Recognized in Earnings (Loss)
	Three Months Ended June 30,						Statement of Operations Classification
	2016	2015		2016	2015
	(In $ millions)
Designated as Cash Flow Hedges
Commodity swaps	1	—		—	—		Cost of sales
Cross-currency swaps	—	—		—	—		Other income (expense), net; Interest expense
Total	1	—		—	—
Designated as Net Investment Hedges
3.250% Notes(1)	7	(13	)	—	—		Foreign currency translation
Term C-2 and Term C-3 loans(2)	—	(8	)	—	—		Foreign currency translation
Total	7	(21	)	—	—
Not Designated as Hedges
Interest rate swaps	—	—		—	(1	)	Interest expense
Foreign currency forwards and swaps	—	—		6	—		Foreign exchange gain (loss), net; Other income (expense), net
Total	—	—		6	(1	)

______________________________

⁽¹⁾  During the three months ended June 30, 2016, the Company redesignated €200 million of its 3.250% Notes as a net investment hedge.

⁽²⁾  During the three months ended December 31, 2015, the Company dedesignated the Euro-based principal amount of its Term C-3 loan as a net investment hedge.

	Gain (Loss) Recognized in Other Comprehensive Income (Loss)			Gain (Loss) Recognized in Earnings (Loss)
	Six Months Ended June 30,						Statement of Operations Classification
	2016		2015	2016	2015
	(In $ millions)
Designated as Cash Flow Hedges
Commodity swaps	1		—	—	—		Cost of sales
Cross-currency swaps	—		—	—	46		Other income (expense), net; Interest expense
Total	1		—	—	46
Designated as Net Investment Hedges
3.250% Notes(1)	2		28	—	—		Foreign currency translation
Term C-2 and Term C-3 loans	(1	)	—	—	—		Foreign currency translation
Total	1		28	—	—
Not Designated as Hedges
Interest rate swaps	—		—	—	(1	)	Interest expense
Foreign currency forwards and swaps	—		—	13	(68	)	Foreign exchange gain (loss), net; Other income (expense), net
Total	—		—	13	(69	)

______________________________

⁽¹⁾  During the three months ended March 31, 2016, the Company dedesignated €260 million of its 3.250% Notes as a net investment hedge.

See Note 15 - Fair Value Measurements for further information regarding the fair value of the Company's derivative instruments.

Certain of the Company's commodity swaps, and foreign currency forwards and swaps permit the Company to net settle all contracts with the counterparty through a single payment in an agreed upon currency in the event of default or early termination of the contract, similar to a master netting arrangement.

Information regarding the gross amounts of the Company's derivative instruments and the amounts offset in the unaudited consolidated balance sheets is as follows:

	As of June 30, 2016	As of December 31, 2015
	(In $ millions)
Derivative Assets
Gross amount recognized	10	2
Gross amount offset in the consolidated balance sheets	—	—
Net amount presented in the consolidated balance sheets	10	2
Gross amount not offset in the consolidated balance sheets	2	—
Net amount	8	2

	As of June 30, 2016	As of December 31, 2015
	(In $ millions)
Derivative Liabilities
Gross amount recognized	3	2
Gross amount offset in the consolidated balance sheets	—	—
Net amount presented in the consolidated balance sheets	3	2
Gross amount not offset in the consolidated balance sheets	2	—
Net amount	1	2