Deep Down Secures $6M Finance Deal
Prospect Capital has provided growth and recapitalization financing of approximately $6.0 million to Deep Down, Inc., a deepwater drilling services and manufacturing provider based in Houston, Texas.
Deep Down, founded in 1997, produces a line of specialized products, including umbilical hardware between platform and subsea wellheads, flow lines, distribution systems, steel flying leads, morays, carousels, umbilical terminations, controls, winches, and launch and retrieval systems. The company also fabricates component parts and assemblies for subsea support distribution systems specializing in the development of offshore subsea fields and tie backs. In addition, Deep Down provides installation management and engineering services for subsea applications. Deep Down is led by Ron Smith, President and Chief Executive Officer, who has more than 25 years of experience in the offshore deepwater subsea industry, and Gene Butler, Chief Financial Officer, who was formerly the Chief Executive Officer of Weatherford International, Inc., one of the largest diversified upstream oilfield service companies in the world. Deep Down's strategy is to consolidate and grow service and manufacturing providers in the offshore industry.
Deep Down is utilizing Prospect's financing for growth capital and repayment of existing liabilities. Prospect's investment is in the form of a senior secured debt instrument. Prospect has received warrants in Deep Down as part of its investment.
"Prospect's capital will help us grow our business to meet the robust customer demand that we see in the subsea market, as well as significantly enhance our ability to achieve the strategic objectives we have set for ourselves in the creation of shareholder value," said Ron Smith, President and CEO of Deep Down.
"We believe Deep Down is well positioned to continue its growth in the deepwater offshore business, a market we view as attractive," said Mark Hull, an investment professional with Prospect Capital Management.