Otto Marine Inks $170M Sale, Leaseback Deal for 2 AHTS

Otto Marine Limited, a Singapore-listed offshore marine company, has entered into a sale and leaseback deal with an undisclosed company for 2 large Anchor Handling Tug Supply Vessels (AHTS) for $85 million each.

The VS491 21,000 brake horsepower (bhp) vessels are now being constructed at Otto Marine’s yard in Batam, Indonesia and they are scheduled for completion in August and October 2013, respectively. Both the vessels will be chartered by Otto Marine for a period of 8 years.

The DNV classed and Norwegian-designed VS491 21,000 bhp AHTS are hybrid propulsion diesel electric driven vessels with dynamic positioning 2 (DP2) technology. The vessels, which are 300 feet (91.5 meters) in length and 74 feet (22.5 meters) in width, have a bollard pull of 240 to 260 tons. They can operate and handle large rigs in the ultra-deepwater region, including the North Sea.

“The Group is pleased to have arranged the sale and leaseback of two of its Ultra Large AHTS at $85 million each which is supported by a few renowned independent valuers. Together with our current Rights Issue, this arrangement will contribute significantly towards improving the Group cash flow, reduce bank loans and improve its gearing ratio, thus strengthen its balance sheet," Michael See, Otto Marine's executive director & Group chief financial officer said in a press release.

"We have already put in place a strengthened team of key and middle management to drive the revival of our shipyard operations. With an improved financial position and the release of capacity at our Batam shipyard, the Group is now ready to take on more jobs, including shipbuilding, ship repairs and fabrication works. We are encouraged by the buoyant offshore oil and gas industry and are determined to restore Otto Marine’s position as one of the key players in the offshore and marine space.”

Earlier this month, Otto Marine sold a multi-purpose field support and remotely operated vessel to RY Offshore Limited for $50 million. Upon completion of the sale, RY Offshore will lease the vessel to Otto Marine's subsidiary, Go Marine Group Pty Ltd.

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