New World Supply, where S.D. Standard Drilling (SDSD) has an ownership of 26.2 percent, has completed a sale of its remaining four medium sized platform supply vessels (PSVs).
The NWS vessels, "World Diamond", "World Peridot", "World Pearl" and "World Opal , have been in lay-up in Norway since October and November 2016. last year, the company completed a sale of two of its six medium sized platform supply vessels (PSVs).
According to the Cyprus-based company, the transaction is completed and the purchased price has been fully paid for all four vessels. All terms have been agreed and there are no further conditions.
The transaction is done at a level that reflect higher vessel value compared to SDSD's book value and significantly higher than the acquisition price of the shares in New World Supply Ltd purchased by SDSD. NWS and its subsidiaries now have cash holdings only and no vessels.
SDSD has previously highlighted that it will take advantage of opportunities that may appear. Further SDSD has stated that it considered its holding in NWS as a financial investment. Consequently, the sale of these vessels, at a significantly higher price than the purchase price, is in line with SDSD's strategy.
"This transaction is in line with our expectations of an increase of the value of our fleet. The sale of vessels is done at higher levels compared to the two vessels sold in October 2018. Further, this transaction is evidence of the fact that the company's purchase price of shares in New World Supply were done at highly attractive levels. The company's ultimate strategy is to create shareholder value. This transaction supports this strategy" says Martin Nes, Chairman of the Board in SDSD.
After the transactions, Standard Drilling has a 100% ownership of five large-size modern PSVs. In addition, the company has invested in 9 mid-size PSVs, bringing the total fleet of partly and fully owned vessels to 14 PSVs, including one vessel on a bare-boat contract.
The pro-forma cash balance of SDSD end of March 2019 would be approximately USD 36 million, as if the Transaction was closed in March, including pro-rata ownership of cash in subsidiaries and investments, of which USD approximately 20.5 million is cash in SDSD and subsidiaries.