Deep Sea raising $200m

John Fredriksen’s Deep Sea Supply is gearing up for a share sale to pay for 10 new PSVs from the tycoon’s private account.

The company will sell $200m in a placement backed by Fredriksen’s Hemen Holding.

Another Fredriksen company, PSV Holding, is selling the 10 supply ships, in a deal announced earlier this year.

The price of the vessels is $366m.

Deep Sea is getting them at a 13% discount to broker valuations of $419m.

The purchase will increase the current fleet of the company from 30 to 40 vessels.

Deep Sea said the ships will achieve attractive cash break even rates, estimated to be $ 10,000 to $12,000 per day, with rates currently between $23,000 and $26,000 per day.

Five of the vessels were delivered from Cochin Shipyard in India and Sinopacific Shipyard in China during 2013 and the first quarter of 2014.

Five more due from the same yards in the third and fourth quarters.

A total of $136m remains to be paid in instalments.

Bank financing of $200m will also be secured, maturing over 28 years.