SD Standard Drilling takes stake PSV ownerVessel & ROV News // January 25, 2017
SD Standard Drilling Plc has secured 15.6 per cent ownership in New World Supply Ltd, a Cayman Island exempted company that, through its wholly owned subsidiaries, owns the 2013-built 3300 CD PSVs World Diamond, World Peridot, World Pearl, World Emerald, World Opal and World Sapphire.
The vessels are mid-size PSVs, all built at Damen Shipyard Group in Galati (Romania) with 728m2 deck area, 3,300 dwt and equipped with DP 2 capability.
The vessels were originally acquired en-bloc by New World Supply from World Wide Supply on a 'where is/as is' basis for a total consideration of US$27.5 million. The initial capitalization of New World Supply exceeded this amount by US$5 million in order to ensure that New World Supply is properly funded for its operation going forward, hence the initial all equity financing of New World Supply is US$32.5 million.
The purchase price for 15.6 per cent ownership in New World Supply is US$5.1 million.
SD Standard Drilling said the opportunity to capitalize New World Supply was offered pro-rata to all bondholders of WWS. The company currently owns US$19.746 million (face value) of WWS bonds. The bonds were acquired for US$3.410 million. As bondholder in WWS, the company had rights to subscribe for shares in New World Supply and
has been allocated 15.6 per cent of the shares in New World Supply.
The net investment for the New World Supply shares to be booked in the first quarter of 2017 is estimated at US$3.3 million after subtracting the initial proceeds that the company will receive from its bondholding in WWS.
Furthermore, the company may receive up to US$750,000 in additional proceeds from its bondholding in WWS, however, the company estimates this figure to be lower due to expenses related to winding down WWS.
Following the completion of investments in New World Supply and acquisition of vessels from Volstad Shipping (as announced on 19 January 2017), the company owns 100 per cent of three large-size PSVs and has invested in additional 13 mid-size PSVs, bringing the total fleet of partly and/or fully owned vessels up to 16 PSVs.
"We are very pleased with the investment. The vessels are favourably priced at approximately US$4.6 million per unit, representing a discount of approximately 86 per cent to the actual newbuild price of around US$34 million and a discount of approximately 76 per cent to the 25-year current newbuild parity of a four year old vessel with an implied value of approximately US$18.9 million," said Martin Nes, chairman of the company.