Bergen Group has decided to divest the company’s rig-service activity at Hanøytangen. The total transaction price is set to NOK 245 million ($30.2 million).
Sale agreements have been concluded with Semco Maritime AS for the operational activity and with Hellik Teigen AS for the real estate.
The well-established industrial area at Hanøytangen outside Bergen has for many years been an important facility for the offshore division in Bergen Group, the company said in the press release. Going forward, Bergen Group has concluded it strategically appropriate to bring in new international ownership to take over the further development of the rig-service activity at Hanøytangen.
“The offshore market has become more challenging, volatile and complex. An increased international competition is expected, and this calls for a substantial and flexible project capacity as well as future investments in developing the yard. Bergen Group has in this respect evaluated various strategic alternatives and financial measures for Hanøytangen. Based on a comprehensive process, the board of directors in Bergen Group has concluded on a sale of both the real estate and the operating assets as the best alternative available,” states Magnus Stangeland, chairman of Bergen Group ASA.
The parties plan a final closing within 3-4 weeks from today. The sale agreement does not include the positive financial effect of the ongoing rig project on Safe Bristolia, which is expected to be finalised by Bergen Group around closing time.
When closing has taken place, Bergen Group will pass their position as a well-established provider of rig service, maintenance and classing over to Semco Maritime.
“Bergen Group has over many years worked with Semco Maritime on various projects at Hanøytangen. We are satisfied with handing over the future development of this unique offshore yard to such a well-established international contracting and engineering company. We also see an exciting potential in a future cooperation between Bergen Group and the new owners at Hanøytangen, based on Bergen Group Services and their strong position within industrial and maritime service,” Stangeland comments.
Steen Brødbæk, CEO of Semco Maritime, said: “The acquisition is an important strategic step for Semco Maritime in pursuing our ambition to become the North Sea leader within projects, service and maintenance for the rig market. Hanøytangen has excellent yard facilities and is the deepest dry dock in Europe. It is a perfect match to our existing facilities in Esbjerg and Invergordon. Hanøytangen completes our set up in the North Sea triangle, thus enabling us to provide a very strong proposition to our clients with one of the largest and strongest rig upgrades and service facilities in Europe.”
In addition to the sale of the operational activity to Semco Maritime, Bergen Group has also sold the company’s real estate at Hanøytangen to Hellik Teigen AS. This company has today a strong foothold at Hanøytangen, both through its ownership of Norscrap West, being the neighbouring company to the offshore yard, and through its presence as a major landowner in the area, Bergen Group said.
“Hanøytangen, with its location and facilities, is a unique site in a European context, and we are very satisfied with this opportunity to expand our ownership in the area. We look forward to welcoming such a strong and reputable player as Semco Maritime on a permanent basis to Hanøytangen, and are certain that they will succeed in realizing the full market potential of the facilities,” says Ring Tore Teigen, CEO of Hellik Teigen AS.
“We look forward to working with Hellik Teigen, who is a strong local partner, on the future development of the Hanøytangen facilities, where we see major possibilities. We enter this engagement to establish a strong third leg in our North Sea rig upgrade and service business and we are confident that we can transfer know how, procedures and best practice from our other units and tap into the market potential to make Hanøytangen successful and profitable,” says Steen Brødbæk.
After the sale of Bergen Group ASA’s properties and operating assets at Hanøytangen, the Group’s remaining operational activity is related to the Services-segment, consisting of Bergen Group Services and Bergen Group Skarveland.
In 2014, these companies with over 250 employees, had in total revenues of approximately NOK 400 million ($49.3 million). The sale transaction enables Bergen Group to further strengthen the ongoing process of developing these companies and their strong position within industrial and maritime service, including prefabrication and service assignments towards the oil and gas industries. The order backlog for the Services-segment has during 2014 increased from NOK 45 million to NOK 171 million. Earlier this year, Bergen Group made an acquisition of the enterprise business at Fjell Industries AS at Sotra as a part of the process of securing further growth in the Group’s continued business segment.
According to Bergen Group, the proceeds from the transaction will be used to repay debt and to strengthen the group’s liquidity position. The property transaction will result in the following estimated accounting effects:
– An impairment loss of approximately NOK 145 million allocated to property, plant and equipment’s, to be recognized in the 2014 financial statements.
– A net reduction of approximately NOK 20 million related to deferred tax asset, to be recognized in the 2014 financial statements.
– A net gain before tax of approximately NOK 20 million allocated to disposal of investment in joint venture, to be recognized in the Q2 2015 interim report.
The transaction of net operational assets will result in a net gain before tax of approximately NOK 30 million ($3.69 million) allocated to disposal of net operational assets, to be recognized in the Q2 2015 quarterly report.