Sevan Marine Sells FPSOs to Teekay
Sevan Marine has reached an agreement in principle with Teekay in relation to a sale of three floating production storage and offloading (FPSO) units by Sevan Marine to Teekay. Teekay will also acquire an equity interest in a recapitalized Sevan Marine as part of the agreement in principle.
Under the terms of the agreement in principle, which has been approved by the Sevan Marine and Teekay Boards of Directors, Teekay will:
- acquire from Sevan three FPSO units, the Hummingbird, Piranema and Voyageur (upon completion of upgrade), along with their existing charter contracts;
- finance the completion of the FPSO Sevan Voyageur upgrade;
- subscribe to a new issuance of Sevan Marine equity to acquire a significant ownership position in a recapitalized Sevan Marine; and
- enter into a cooperation agreement to acquire future FPSO projects developed by Sevan Marine.
"We are pleased to announce that the Board has reached an agreement in principle for a long-term restructuring of Sevan Marine. We believe the proposed transaction with Teekay represents a good solution for all stakeholders of Sevan Marine, including our employees and customers, and also supports the further growth of the Company. We will also preserve our leading engineering and design capabilities and intellectual property. Together with Teekay as a strong industrial partner, we will be well positioned to benefit from opportunities in a growing FPSO market," commented Carl Lieungh, Chief Executive Officer of Sevan Marine.
"Our investment reflects our confidence in Sevan's strong offshore project development expertise while providing Teekay with an enhanced pipeline of future on-the-water FPSO growth opportunities," commented Peter Evensen, Teekay's President and Chief Executive Officer.
Teekay reached the agreement in principle for its participation in a consensual restructuring of Sevan Marine's capital structure following discussions with Sevan Marine's Board of Directors, some of its largest shareholders, and a group of bondholders holding a majority of each of Sevan Marine's bond classes. The transaction remains subject to finalizing details and agreement of definitive documentation, in addition to formal approval by the bondholders in each of Sevan Marine's bond classes, the approval from Sevan Marine's shareholders, consent from Sevan FPSO charterers, and approvals by regulatory authorities. Prior and subsequent to the transaction closing, Sevan Marine will continue operate as a publicly-listed company on the Oslo Børs. It is expected that the terms of the transaction will be announced during the week of October 3, 2011.
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