X-Subsea in administrationCompany News // April 29, 2015
The operator of what is claimed to be the world’s largest fleet of controlled flow excavation and precision dredging equipment, Aberdeen-based X-Subsea UK Holding Ltd, and its UK-based subsidiaries, X- Subsea UK Ltd and X-Subsea Atlantic Ltd, have been placed in administration with Iain Fraser and Tom MacLennan, partners with FRP Advisory, appointed joint administrators.
X-Subsea designs and builds a range of patented tools that can operate to depths of up to 2,500m. The specialised equipment can generate a flow of up to 8 tonnes of water per second and its non-contact excavation techniques prevent damage to pipelines, cables, sub-sea structures and the environment.
X-Subsea provides a full range of services, from surveying, planning, design and supply of equipment, through to on-site excavation, dredging and project management. Customers range across the oil and gas, renewables and civil engineering industries.
There are 26 staff based in Aberdeen, but with only one ongoing contract and a lack of funding it was not viable to trade the business in the short term. Six employees based overseas have been retained to complete the contract, however the remaining 20 Aberdeen-based staff have been made redundant with immediate effect.
The administration has been caused by unsustainable losses and cash flow problems stemming from a downturn in orders.
X-Subsea’s parent company, Norwegian based Reef Subsea AS, was placed in Norwegian insolvency proceedings in early February of this year.
X-Subsea had historically been reliant on support from its parent but withdrawal of this combined with the downturn in work and consequent financial constraints have resulted in administration being the only option. The joint administrators from FRP Advisory LLP will now seek a buyer for the businesses and assets.
Iain Fraser, partner at FRP Advisory and joint administrator said: “X-Subsea is the market leader in the design and supply of highly sophisticated excavation and dredging equipment.
"The business has been badly affected by the current downturn in the oil and gas sector, and despite restructuring of the group earlier this year, income and cash flow has fallen substantially, with administration of the UK businesses being the only option. X-Subsea has a blue chip client base and interests in valuable intellectual property assets. We will now market the businesses and assets for sale, and would urge interested parties to contact us as soon as possible.”
The UK companies have subsidiary operations in the USA (Houston), Mexico (Ciudad del Carmen) and Singapore. These overseas subsidiary businesses are not in administration.