BOURBON Invests Heavily in Gas Sector
While BOURBON is undeniably a leader in the offshore marine sector, the current tough offshore environment has led it to diversify its operations in the face of a potentially prolonged down market globally. With that, the company announced the acquisition of the activities of a global leader in ethane transportation, with a market share greater than 50% in a market expected to have strong growth.
It comprises the following companies who are currently owned by their majority shareholder, JACCAR Holdings:
- 100% of Greenship Gas, a Singaporean owned “shipping trust”, comprising directly or indirectly of: A fleet of 17 vessels (of which 13 vessels are currently in service) dedicated to the transport of Ethane gas, Ethylene and LNG and having an average age of 3,5 years;
- 100% of EVERGAS, operator and contractor of gas transportation services (www.evergas.net);
- 100% of Greenship Gas Manager Pte. Ltd, manager of the Greenship Gas “shipping trust”;
- 80% of JHW Engineering & Contracting limited. This company encompasses the design and engineering of vessels, the technology and control of a manufacturing platform for mega-tanks as well as procurement activities and contracting and management of gas projects (www.jhwshanghai.com).
The final completion of the acquisition, which was authorized by the Board of Directors on March 28, taking into account the opinion of an ad hoc committee and the opinion of an independent expert, is subject to ratification by shareholders at the Annual General Meeting on May 26, 2016, during which related parties will vote their shares in a manner so as to not influence the decision.
The purchase price for these companies is $320 million with a net debt as of December 31, 2015 of $389, the financing of the vessels being transferred as part of the transaction.
BOURBON will benefit from a seller’s credit of $100 million with no interest for a maximum period of three years. It is anticipated to have in place a $220 million bridge loan for a maximum period of three years. In fact, BOURBON will proceed, once the transaction is completed, with the resale of 80% of the ownership of the vessels, which will then be retained on bareboat charter for a minimum period of ten years. The bridge loan signed at the time of the acquisition would then be reimbursed and the impact on BOURBON’s debt decreased significantly.