Australian offshore vessel owner MMA Offshore has agreed to sell its shipyard facility in Batam, Indonesia to Wasco Engineering Group.
Wasco will pay $15 million for the shipyard facility. The transaction is expected to complete by December 30, 2022. The purchase price will be paid in tranches with the total amount payable on or before the completion date. MMA Offshore said it would use the cash from the sale to strengthen its balance sheet.
The Batam facility will remain subleased to Wasco for the period until completion with rent structured to deescalate upon receipt of the tranche payments.
MMA will retain a portion of the Batam facility and have access to the wharf for a period of 5 years following the completion of the sale.
MMA's Managing Director David Ross said: "The sale of the Batam shipyard is an excellent outcome for the company and in line with our strategy to divest non-core assets. The consideration of US$15 million (approximately A$20 million) will materially reduce our net debt position, deleveraging our balance sheet and positioning the company well to take advantage of growth opportunities in an improving market. I wish WASCO every success in their operations at the facility."
MMA Offshore's Batam Shipyard facility spans just over 18 hectares, with warehouse storage, significant open laydown area, and direct water-frontage. MMA Offshore bought it in 2014.
According to info on MMA Offshore's website, the shipyard has delivered over 30 offshore vessels in last 20 years, however, with the decline in newbuild activity the shipyard is now a laydown and project preparation facility for the company's vessel activity in South East Asia. It is also being used to support MMA Offshore clients’ varied onshore marine-related requirements.