HC2 Holdings (HC2) has started exploring strategic alternatives, including a potential sale for its Global Marine subsidiary.
The company, who acquired Global Marine in 2014, received support from Fugro, who holds interest in Global Marine, for the sale.
In November 2017, Fugro sold its non-core trenching and cable laying business in return for an equity interest of 23.6% in Global Marine and a USD 7.5 million secured vendor loan. The vendor loan has been repaid in full in the third quarter of 2018.
“Fugro is aligned with HC2 and will support this process including a potential sale of Fugro’s stake in Global Marine,” the company said.
As part of the process, Global Marine, provider of offshore engineering services to the telecommunications, renewables and oil and gas industries, has engaged Deutsche Bank Securities and ABN AMRO Bank as joint advisers to explore strategic alternatives for the business.
“Since our acquisition four years ago, the management team at Global Marine has repositioned and strengthened itself by securing and maintaining leadership positions in various key growth markets, a testament to the strength of this business and the quality and focus of the team,” said Philip Falcone, HC2 chairman, president and CEO.
“They’ve renewed the fleet of marine assets through strategic acquisitions and re-organized the business to pursue attractive growth opportunities, all while substantially reducing debt that was assumed during the acquisition. We believe exploring strategic options now will clearly position the next buyer to strategically capitalize on the next phase of growth of the Global Marine business, while allowing current investors an opportunity to realize substantial value creation since the acquisition in 2014. Reducing HC2’s debt cost of capital has been a top priority of ours, and we believe monetizing this asset will get us above and beyond that important goal.”
Falcone added: “We’ve been delighted to be part of the Global Marine journey and having reviewed what we believe are incredible prospects for this business, we believe that now is the right time to explore strategic alternatives to support the growth trajectory of the business set by executive chairman Dick Fagerstal and long-term chief executive officer Ian Douglas.”
“We very much welcome this decision from HC2 to explore strategic options to support the continued growth of the Global Marine Group platform,” said Ian Douglas, CEO of Global Marine. “Together, we have strengthened the business and grown across our target markets, and we believe we have a great opportunity to accelerate our growth with our experienced and proven management team, strong balance sheet, enhanced and upgraded portfolio of marine assets and a solid pipeline of secured and potential project opportunities.”
Neither HC2 nor Global Marine have set a timetable for completion of the process.