Marine service provider MMA Offshore has decided to sell two of its Australian supply base assets in order to reduce debts.
MMA Offshore informed on Tuesday it has entered into agreements with Toll Group for the sale of its Dampier and Broome Supply Base assets.
The company explained that the sale of both assets was part of its ongoing capital management strategy to rationalize non-core assets and reduce debt over the course of the 2017 financial year.
MMA will realize approximately $44.1 million from the sale of the Dampier Supply Base asset and $8.7 million from its 50% interest in the Toll Mermaid Logistics Broome Supply Base, before adjustments and costs associated with the transactions. The net proceeds of the transactions will be applied to debt reduction.
The transactions are subject to customary regulatory approvals by Foreign Investment Review Board (FIRB), Australian Competition and Consumer Commission (ACCC) approval; and consultation with ASX in relation to the potential application of ASX Listing Rules 11.1 or 11.2 to the proposed supply base sales.
The Dampier Supply Base asset sale is expected to complete by June 2017 and the Broome Supply Base sale by April 2017.
MMA’s Chairman, Tony Howarth, said: “Historically the Supply Base assets were a significant contributor to the earnings of our predominantly Australian focused operations. However, in recent years the Supply Base business has become less significant as the company has focused its strategy on its Australian and international offshore vessel operations.
“Proceeds from the sale will strengthen our balance sheet and position MMA to take advantage of improved oil and gas market conditions when they occur.”