Dockwise Ltd
oslo : DOCK

April 22, 2012 14:47 ET

Dockwise Ltd :Proposed Acquisition of Fairstar by Dockwise to Accelerate Achievement of Strategic Goals

BREDA, THE NETHERLANDS--(Marketwire - Apr 22, 2012) - Dockwise Ltd., indirectly, through its wholly-owned subsidiary Dockwise White Marlin B.V. (the "Company" or "Dockwise"), has entered into share purchase agreements for the acquisition of approximately 54 % of the shares in Fairstar Heavy Transport N.V. ("Fairstar"), a company listed on the Oslo Stock Exchange. Certain of these agreements representing approximately 19 % of the shares in Fairstar have today become unconditional and will be completed shortly. Other agreements remain conditional, and completion of these agreements is subject to approval of resolutions for the financing of the purchase of shares in Fairstar through an offering and issuance of new shares in Dockwise, primarily by the way of a rights issue, at the General Meeting of Dockwise shareholders ("AGM") to be held on 9 May 2012. Following and subject to such approval at the AGM, the conditional purchase agreements will be completed, and Dockwise intends in such case to launch a public offer to acquire all of the remaining issued shares in Fairstar for 9.30 NOK per share in cash.


* Step change in the scale and focus of the Dockwise fleet:

* to better serve rapidly growing and evolving customer demand in the global oil & gas industry * to secure a global sustainable leadership position as a heavy marine transport and oil & gas service provider in an increasingly competitive market environment

* A balanced presence throughout the oil & gas exploration, development and production phases:

* reducing Dockwise dependence on short term upstream contracts * enhancing visibility on future revenues and earnings

* Advancement of Dockwise fleet rejuvenation plan, with associated capex savings * EBITDA and cash flow enhancing, immediately * Offer of 9.30 NOK implies premium of more than 22% on latest share price of NOK 7.62 * Transaction to be financed through equity issue of USD 230 - 300 million, consisting of:

* approximately USD 250 million rights issue, of which as of today USD 234 million has been committed * issue of USD 50 million bridge equity in preference shares

* Shareholders in the enlarged Dockwise group to benefit from greater critical mass by market capitalisation and improved liquidity and stability of investment

Dockwise's Chief Executive Officer, André Goedée, said: "The proposed acquisition of Fairstar, and the integration of their four vessels into our fleet significantly accelerates progress towards our strategic objectives. Fairstar's growing position in downstream processing projects, including LNG module transportation developments such as Gorgon and Ichthys, is highly complementary to Dockwise's existing market strengths. The transaction powerfully enhances our ability to provide our clients throughout the Oil & Gas industry with the diverse and project specific services they require. Next and of equal importance is the fundamental increase in size of Dockwise, reinforcement of its balance sheet and increased earnings potential. An important step forward at the right time."

A teleconference for analysts and investors will be conducted on 23 April 2012 at a time later to be announced through the Dockwise website; During the same call the earlier released Q1 2012 results will be explained. A dial in number and access code for the conference is available upon request to The teleconference can be followed via a live audio-webcast: Participating in the conference requires that you dial in using our conference call number. The presentation will be made available on 23 April 2012 at 08:00 hrs CET through Oslo Newsweb and the Dockwise website.


Through the proposed acquisition of Fairstar, Dockwise intends to accelerate its strategy to be a more diversified heavy marine transportation, installation and logistical management service provider. In recent years, Dockwise has successfully grown its commercial activities across the several phases of the oil & gas upstream and downstream cycles. Whilst Dockwise has a strong presence in the exploration and development phase through the transport of drilling rigs, and in the production phase through transporting & installing production platforms, Dockwise believes that this transaction will enhance its presence in the later downstream processing phase allowing it to reach a balanced spread across both cycles. Fairstar has developed a strong market position in the logistical management business, mainly in the downstream cycle.

The proposed combination of Dockwise with Fairstar would create an enhanced presence against a background of expected market growth in the medium term, through the expansion of remote processing facilities for hydrocarbon liquids, LNG and FLNG.

The objective of the proposed transaction is to achieve a balance of 50% in the exploration and development phase (characterized by short-term projects) and 50% in the production and processing phases (characterized by longer term projects). All of Fairstar's vessels fully complement the Dockwise fleet in terms of age, capability and market segment. The proposed acquisition is expected to deliver substantial strategic benefits and is immediately EBITDA enhancing. It is believed that the proposed combination will bring Dockwise improved, more secure, growth prospects underpinned by a strong, well- capitalised balance sheet.

Once implemented, the strategy is expected to prove beneficial to:

* The combined company: The transaction would create a distinct market leader in an increasingly competitive global industry. The industries serviced by Dockwise and Fairstar are entering a sustained period of strong growth, marked especially by the increasing size of cargoes and vessels. Fairstar's vessels complement Dockwise's capacity to focus on the higher end, offshore and onshore logistical projects and fit well with Dockwise's fleet rejuvenation and replacement program. As a result, the combined entity is expected to realize significant long-term income and cost synergies related to better fleet scheduling and reductions in SG&A.

* Clients: Clients will be able to contract with a substantially larger service provider with a bigger, and on average younger, more versatile, and evenly distributed fleet. The combination is expected to alleviate client concerns about bottlenecks in availability, provide a broader choice of vessels to meet clients' specific requirements, and on occasion the ability to convert vessels for special assignments.

* Employees: Employees will have greater career opportunities within the combined company amidst a secure professional environment. No forced redundancies are expected as a result of the proposed transaction and employees' existing rights will be honoured. A successful combination can be expected to make Dockwise a higher profile brand name for all employees as the company becomes globally more prominent.

* Shareholders: Subject to completion of the conditional purchase agreements, Dockwise intends to offer all remaining Fairstar shareholders the opportunity to exit a low liquidity stock with an offer at NOK 9.30, a premium of more than 22% compared to the closing share price of 20 April 2012. Dockwise shareholders will hold a stake in the distinct market leader within the global industry. Dockwise's expansion into downstream activities is expected to increase backlog and earnings visibility while reducing dependence on the early phases of the upstream cycle. Furthermore, this transaction is expected to increase Dockwise's share liquidity, while the increased market capitalisation may be expected to attract broader international shareholder interest.

* Financing partners: Both Fairstar's and Dockwise's lenders may expect to benefit from a larger and more versatile fleet and contract portfolio. On completion, the combined entity is expected to be a more profitable and financially robust company than before. Dockwise intends to buy Fairstar bonds from bondholders who wish to terminate their position.

* Suppliers: Suppliers may expect to benefit from the commercial security of an enlarged and more secure counterparty.


Dockwise has, indirectly through its wholly-owned subsidiary Dockwise White Marlin B.V., entered into conditional share purchase agreements with a number of Fairstar shareholders. None of these share purchase agreements includes a competing bid opt-out.

As of today, certain of the share purchase agreements have become unconditional. This applies to agreements with Torghatten (15%) and with certain other Fairstar shareholders, in the aggregate representing (together with Torghatten) approximately 19 % of the shares in Fairstar. These unconditional share purchase agreements will be completed this week.

The other share purchase agreements remain conditional on the approval of certain resolutions relating to the financing of the Transaction at the Dockwise AGM, expected to be held on 9 May 2012. This applies to the agreements with Oceanus (26.6%) and certain other Fairstar shareholders, in the aggregate representing (together with Oceanus) approximately 35 % of the shares in Fairstar. Dockwise expects that the conditions under these purchase agreements will be satisfied on or shortly after 9 May 2012 and that all these share purchase agreements will be completed thereafter. Should these conditions not be satisfied or, where relevant, waived, then these conditional share purchase agreements will terminate. In the event the conditions are satisfied and the conditional share purchase agreements are completed, Dockwise expects that it will then hold approximately 54 % of the shares in Fairstar, and Dockwise expects that it will then launch a public offer for all of the shares in Fairstar and that this will, at that point in time, be a mandatory offer.

The public offer will, if launched, be made in accordance with all applicable laws and the offer price is expected to be NOK 9.30 per share in Fairstar (the "Offer Price"). Further announcements in respect of such offer, including the confirmation of whether or not it will be launched, will be made in due course in accordance with applicable laws.

Dockwise has informed Fairstar's supervisory board and management board of its unconditional and conditional share purchases and its plans, and has invited Fairstar to start a consultation process with Dockwise with regard to the proposed transaction and its consequences. Dockwise has also informed the relevant Dutch and Norwegian regulatory authorities, the Sociaal Economische Raad (SER) and has invited trade unions to start consultations with regard to the proposed transaction. Dockwise has also received a positive advice from its own works council.


To finance the proposed transaction, the Company will use available cash reserves and, subject to AGM approval, intends to raise new equity in the amount of USD 250 - 300 million, through: (i) a rights issue and (ii) issue of bridge equity in the form of financial preference shares.

i. Rights Issue

Dockwise intends to raise new equity through a rights issue towards its existing shareholders in the amount of approximately USD 250 million. Existing shareholders of Dockwise who may lawfully subscribe to shares to be issued will, subject to applicable securities laws, be allocated subscription rights according to their shareholding at the date of record. The Company intends to allow for trading of subscription rights on Oslo Børs and Euronext Amsterdam. Over-subscription and subscription without rights will not be permitted. The subscription rights entitle those holders to subscribe for the shares in the Rights Issue at a subscription price of EUR 14 per share (or EUR 15 per share should the volume weighted average price of the Dockwise shares listed and traded on NYSE Euronext Amsterdam ("VWAP") over the period commencing 09.00 CET on the date falling six business days prior to the record date until 17.30 CET on the date prior to the record date be above EUR 15.50).

The corresponding subscription price in NOK in respect of the new shares subscribed for and allocated on basis of exercising subscription rights registered in the VPS will be calculated, set and communicated in close proximity to the end of the subscription period in accordance with a currency conversion which will be described in the prospectus to be published in connection with the Rights Issue.

HAL Investments B.V. ("HAL") and certain other Dockwise shareholders have committed to vote in favour of and participate in the Rights Issue, subject to the approval at the AGM and the fulfilment of other customary conditions. HAL has committed to exercise all subscription rights allocated to it to subscribe for shares in the Rights Issue at the subscription price. In addition, HAL has committed to subscribe for shares in respect of subscription rights that would not be exercised in the Rights Issue up to such a number that HAL will not have more than 33.00% of the voting rights in Dockwise after the Rights Issue. The minimum investment of HAL is approximately USD 45 million, the total maximum commitment of HAL under its agreement with Dockwise is in the range of USD 132 million to USD 156 million.

As per the date of this press release, Dockwise has, subject to the approval at the AGM and the fulfilment of other customary conditions, secured commitments from HAL and other parties to participate in the Rights Issue totalling USD 234 million.

Dockwise will invite other large shareholders to commit to subscribe in and support the Rights Issue.

Shareholders participating in the upfront commitment to the Rights Issue will receive (i) a fee of 1%, to be paid in new shares, for the amount of their commitment to exercise their subscription rights and (ii) a fee of 2%, to be paid in new shares, for the amount of their commitment in excess of the amount which will result from exercising their own subscription rights.

a. Bridge Equity

Dockwise and HAL have agreed upon the issuance by Dockwise to HAL of USD 50 million in financing preference shares, with a cumulative annual dividend of 9 per cent. Dockwise has the right, subject to existing finance arrangements, to (partly) redeem such shares in cash at any time prior to 1 October 2012. If any preference shares are outstanding after 1 November 2012, then

* if the one-month average market price is more than 10% above or below the issue price under the Rights Issue, any remaining preference shares including accumulated dividends shall be placed with investors and converted into common shares at a conversion price such that Dockwise can fully repay HAL; * if the one-month average market price is within 10% of the issue price under the Rights Issue, any remaining preference shares including accumulated dividends will be converted into common shares at a 6% discount to the one- month average market price and issued to HAL up to HAL having a 33.00% stake in Dockwise post issue. If any preference shares remain after such conversion and issuance to HAL, Dockwise at its option can (i) redeem the remaining preference shares including accumulated dividends in cash or (ii) arrange that these remaining preference shares including accumulated dividends are placed with investors and converted into common shares at a conversion price such that Dockwise can fully repay HAL.

Pareto Securities and Pareto Project Finance have acted as financial adviser to Dockwise on the transaction and global coordinator and bookrunner on the rights issue. ABN AMRO and Kempen & Co will act as joint bookrunners for the Rights Issue. NautaDutilh, Thommessen and Appleby have acted as legal adviser to Dockwise.


Fairstar is a provider of marine heavy transport solutions specializing in high- value cargoes for the offshore and onshore energy and construction industries. Fairstar owns and operates two of the most modern semi-submersible heavy transport ships in the global fleet, FJORD and FJELL. The 50,000 DWT, open- stern semi-submersible vessels FORTE and FINESSE are currently under construction with Guangzhou Shipbuilding International in China and will be owned and operated by Fairstar when they are delivered in 2012. Fairstar is based in Rotterdam and quoted on the Oslo Stock Exchange (ticker: "FAIR").

Fairstar has a two tier Board of Directors. A Supervisory Board with F. van Riet (Chairman), J. Verhagen, B. de Bruin-van Eijck and R. Granheim (members) and a Management Board with Philip Adkins (CEO) and Willem Out (COO). Fairstar employs approximately 68 FtE (2011). Key figures for 2011:

| In USD Thousands          | 2011     | 2010    | 2009    | 2008    |
  Gross revenues                25,488    35,655    50,672    15,698

  Other income/expenses              -         -     1,330       (4)

  Vessel operating expenses    (7,588)   (7,060)   (7,676)   (5,054)

  SG&A                        (10,879)   (7,660)   (5,347)   (5,254)
  EBITDA                       (5,518)    12,265    24,335     (246)

  Depreciation                 (8,048)   (8,016)   (6,324)   (3,045)
  EBIT                        (13,566)     4,249    18,011   (3,291)

  Net financing costs            (832)   (4,021)   (5,653)   (4,476)
  Result after tax            (14.398)       228    12,358   (7,767)

  Eps diluted                   (0.18)         0      0.30    (0.23)

  Assets                       272,473   267,131   190,857   175,643

  Liabilities                  166,392   147,093   123,488   130,166

  Equity                       106,081   120,038    67,369    45,477

  Average FtE employed              68        54        39        29

Source: Fairstar annual reports on 


The indicative timeline is expected to be as follows:

- Notice of Annual General Meeting Dockwise:
April 2012

- Annual General Meeting Dockwise:
                        9 May 2012

- Start of mandatory offer period:
                        14 May 2012

- Start of subscription period in rights issue:
            16 May 2012

- End of subscription period in rights issue:
            30 May 2012

- End of mandatory offer period:
                        11 June 2012

- Settlement in rights issue:
6 June 2012

- Settlement of mandatory offer:
            25 June 2012


Dockwise Ltd., a Bermuda incorporated company, has a workforce of more than 1,200 people both offshore and onshore. The company is the leading marine contractor providing total transport services to the offshore, onshore and yachting industries as well as installation services of extremely heavy offshore platforms. The Group is headquartered in Breda, the Netherlands. The Group's main commercial offices are located in the Netherlands, the United States and China with sales offices in Korea, Australia, Brazil, Russia, Singapore, Malaysia, Mexico and Nigeria. The Dockwise Yacht Transport business unit is headquartered in Fort Lauderdale and has an office in Genoa, Italy. The Dockwise Shipping network is supported by a global network of agents.

To support all of its services to customers, the group also has three additional engineering centers in Houston, Breda and Shanghai, manufactures specific motion reduction equipment such as LMU (Leg Mating Units) and DMU (Deck Mating Units) and owns a fleet of 19 purpose built, semi-submersible vessels.

Dockwise shares are listed on the Oslo Stock Exchange under ticker DOCK and on NYSE Euronext Amsterdam under ticker DOCKW.

For further information:

This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.

This announcement is distributed by Thomson Reuters on behalf of Thomson Reuters clients. The owner of this announcement warrants that: (i) the releases contained herein are protected by copyright and other applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of the information contained therein.

Source: Dockwise Ltd via Thomson Reuters ONE [HUG#1604704]

Contact Information

  • Dockwise contact:
    Fons van Lith
    E: Email Contact
    T: +31 (0)76 548 4116
    M: +31 (0)6 51 314 952