US fund manager HC2 Holdings has finally found a buyer for UK-based offshore shipping player Global Marine Group (GMG).
HC2 said private equity investor JF Lehman & Company (JFLCO) is paying $250m for 100% of the company, which owns and operates the world's largest independent marine contracting fleet of 26 vessels.
JFLCO will also add in an unspecified extra amount should it achieve certain return targets.
HC2, which has a 73% interest in GMG, put it up for sale in 2018, as it tried to lower its costs.
The deal does not include the previously announced sale of GMG’s 49% joint venture with China's Huawei Marine Networks for $140m.
After repayment of $97m of pension and debt obligations, HC2 will use the money from both sales to buy back some of its notes due in 2021.
New chapter to begin
GMG chief executive Ian Douglas said the company is about to embark on a new chapter.
"The purchase by JFLCO provides the certainty that we need to continue to build our business across the telecommunications and utilities markets, deepening and widening the service we provide to our customers," he said.
"We are fortunate to operate in markets that are transforming the world and we support the rising demand for connectivity of global communications and offshore renewable energy sources.”
Philip Falcone, CEO of HC2, said his financial firm has built GMG into a "tremendous leading company" in the marine services.
"We know they will continue to build on their success while under the JFLCO umbrella,” he said.
Deutsche Bank Securities and ABN AMRO acted as advisors to GMG.
Expansion in last four years
GMG is split into three business units, with Global Marine providing fibre optic cable solutions to the telecoms market, CWind serving the offshore renewables and utilities markets, and Global Offshore delivering trenching and power cable laying capabilities to oil and gas majors.
It also has another joint venture with China Telecom.
The fleet comprises three specialist cable installation and repair vessels, four maintenance ships and 19 crew transfer vessels (CTVs).
It has sold a cable-layer and two CTVs since announcing the sales process in 2018.
HC2 acquired Global Marine in 2014. It then bought CWind in 2016.
The following year it acquired Fugro's trenching and cable-laying business in exchange for an equity stake.
The transaction, valued at $73m, saw Fugro get a 24% slice of GMG.