Seatrium divests AmFELS shipyard in Texas for S$65 million

[SINGAPORE] Offshore, marine and energy engineering solutions provider Seatrium has divested its AmFELS Yard in Brownsville, Texas, for a consideration of S$65 million.

The asset sale is being executed through the group’s subsidiary, Seatrium AmFELS, which has entered into a binding agreement with a related party of Turkish builder Karpowership, Karpower Valley.

This venture will allow Seatrium to enhance capital and operational efficiencies, while unlocking value from one of its surplus facilities.

The consideration amount was arrived at after “arm’s length negotiations” with Karpowership, and shall be satisfied in cash, noted the group in a statement on Tuesday (Sep 23). Of this amount, S$50 million is deferred and to be paid one year after closing.

The book value of the divested assets as at Jun 30, sold on an “as is, where is” basis, is about S$39 million.

Chris Ong, chief executive officer of Seatrium, said: “Notwithstanding the divestment, the US market remains important to us. We will continue to leverage our global footprint and integrated One Seatrium Delivery Model to deliver world-class solutions to our US based and global customers in the offshore and energy sectors.”

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Seatrium will transition its strategic presence in the US after the asset sale to focus on engineering innovation and technology capabilities, through its technology centres and offices located in Houston, Texas, and service centre in Vicksburg, Mississippi.

The completion of the divestment is subject to customary closing conditions, including the transfer of the lease to the new owner by the Port of Brownsville.

Shares of Seatrium closed 3.9 per cent or S$0.09 higher at S$2.43 on Tuesday, before the announcement.