LEADING Australian marine support company MMA Offshore Limited has entered into an agreement to acquire Perth-based topside and subsea inspection, maintenance and repair specialist Neptune Marine Services Limited.
The purchase consideration, which is expected to total approximately A$18.5 million, would comprise $5 million cash with the balance to be issued in MMA shares on completion.
“The acquisition of the Neptune business represents an important step in MMA’s strategy to expand its subsea service offering to existing and new clients,” MMA managing director, Jeffrey Weber, said.
“Combining MMA’s vessel assets with NMS’s subsea equipment and technical expertise will result in a stronger service offering to both MMA’s and NMS’s existing clients and provide an opportunity for MMA to capture a greater proportion of the value chain.
Importantly, the services that NMS provides do not directly compete with our existing clients in the sector and we continue to see these partnerships as a key platform in our subsea strategy going forward. “The acquisition is expected to enhance MMA’s return on assets through packaging value adding services to our vessels. As the offshore market improves, we expect the combined business to benefit from a recovery in offshore and subsea investment,” Mr Weber said.
The directors of NMS have unanimously recommended that the company’s shareholders vote in favour of the transaction in the absence of a superior proposal.
MMA said the acquisition will provide it with a strong platform to expand its subsea services business and value add to its existing subsea vessel offering.
The transaction is also expected to contribute to MMA earnings in an improving market and as revenue and cost synergies are realised, with combined business is expected to benefit from a recovery in offshore and subsea investment.