Join OEdigital on Facebook Join OEdigital on LinkedIn Join OEdigital on Twitter
 

S.D. Standard Drilling increases PSV fleet

Written by  OE Staff Thursday, 19 January 2017 11:04

S.D. Standard Drilling, through wholly owned subsidiaries, has agreed to acquire three ST-216L CD platform supply vessels (PSVs) from Volstad Shipping, increasing its fleet to 10 PSVs. The vessels are to be acquired for a total en-bloc consideration of US$40 million. 

The vessels, Volstad Viking, Volstad Supplier and Volstad Princess are large PSVs, all built at Aker Brattvaag, Norway in 2007-2008, with 1060sq m deck space and equipped with ice class (ICE-1B) capabilities.

"The vessels grow our asset base and fleet significantly and are favorably priced at $13.3 million per unit, representing a discount of 67% to $40.6 million actual newbuild price and a discount of 47% to the 25-year current newbuild parity of a nine-year old vessel with an implied value of $25 million,” said Martin Nes, chairman, S.D. Standard Drilling. “Furthermore, the vessels are all large and well-recognized PSVs which distinguish themselves with their tremendous power, speed and good station keeping capabilities, especially in harsh weather conditions. The vessels have an impeccable operating track record and enable [S.D. Standard Drilling] to enter the Norwegian market. With their ice class capabilities, the vessels are also likely to be deployed for operations in harsh/sub-Arctic regions.”

Fletcher Shipping will act as technical and commercial manager for the vessels. Fletcher already has technical and commercial management for S.D. Standard Drilling's equity investments in PSV Opportunity I, II, and III DIS. 

The acquisition of the vessels, expected to be completed in February 2017, will be financed through S.D. Standard Drilling's cash holding, the share contributions from the subsequent offers and (to the extent necessary) a credit facility.

S.D. Standard Drilling currently has a cash holding of approximately $39 million (NOK 330 million). The subsequent offers related to the private placements that has been completed, will increase the Company's cash holding with up to $2 million (NOK 16.9 million). In connection with the acquisition of the vessels, S.D. Standard Drilling will enter into a six-month revolving credit facility (RCF) at market terms with Saga Tankers totaling $10 million in order to secure the company's available liquidity reserves.

Read 3376 times