GMS aims to raise $100M through London IPO

Gulf Marine Services PLC today announced its intention to proceed with an initial public offering. GMS intends to apply for admission of its ordinary shares to the premium segment of the Official List of the UK Listing Authority and to trading on the main market of the London Stock Exchange.

The company said it expects to raise $100 million through the IPO. The cash raised will be used for the acquisition of the Keloa (a Small vessel currently  leased by GMS, which GMS has the option to purchase) for U.S.$37.5 million and to repay circa. U.S.$20 million in existing shareholder loans, which represents all shareholder loans currently outstanding. The remaining net proceeds will be used, together with existing committed bank facilities and cash generated from operations, to fund GMS’s new-build programme.

GMS operates a core fleet of nine SESVs which are four-legged self-propelled vessels with a large deck space, crane capacity and accommodation facilities that can be adapted to the requirements of the company’s clients. These vessels support GMS’s clients in a broad range of offshore oil and gas platform refurbishment and maintenance activities, well intervention work and offshore wind turbine maintenance work (which are Opex-led activities) and offshore oil and gas platform installation and offshore wind turbine installation (which are Capex-led activities). GMS charters its SESVs to national and international oil companies and broader oil and gas services companies in the MENA region and in Northwest Europe .

In Northwest Europe, GMS also charters SESVs to offshore renewable energy companies and installation contractors to support the construction and maintenance of windfarms. GMS has been operating since 1977 and was acquired by its current shareholders in 2007 . GMS’s fleet of SESVs is technically advanced and amongst the youngest in the industry, with an average age of nine years compared to 16 years for its peers1

The Company has a current order book of U.S.$434 million including options to extend. Since 2007, clients have exercised extension options at a rate of approximately 89%, which provides high revenue visibility.

Fleet expansion

GMS said it believed that the demand in its areas of operations for its vessels is increasing materially and that this represents a significant opportunity for the business to continue to grow. Because of that, GMS said it planned to add up to a further six vessels to its fleet over the next three years as it continues to target long term client contracts and to pursue strategies to expand its market positions.

Duncan Anderson, Chief Executive Officer of GMS, said: “We continue to deliver on our strategy of providing our clients with the most efficient and flexible SESVs in our target regions. With our focus on long-term client contracts and high utilisation, we have delivered consistent EBITDA growth since 2007. Our vessels are in high demand by our clients and we believe demand for our vessels, and for the SESV market as a whole, will continue to increase significantly over the rest of the decade. This gives us confidence to proceed with the planned expansion of our fleet which the net proceeds of the IPO will help to accelerate.”

 

February 17, 2014

 

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