HC2 Holdings is exploring the potential sale of its offshore engineering subsidiary Global Marine.
As part of the process, Global Marine has engaged Deutsche Bank and ABN AMRO as joint advisors to explore strategic alternatives for the business.
Neither HC2 nor Global Marine has set a timetable for completion of the process. Both companies will also not comment further unless a specific transaction or other alternative is approved by the respective boards of directors, the process is concluded or it is otherwise determined that further disclosure is appropriate or required by law.
HC2 chairman, chief executive officer and president Philip Falcone said: “Since our acquisition four years ago, the management team at Global Marine has repositioned and strengthened itself by securing and maintaining leadership positions in various key growth markets, a testament to the strength of this business and the quality and focus of the team.
“They’ve renewed the fleet of marine assets through strategic acquisitions and reorganised the business to pursue attractive growth opportunities, all while substantially reducing debt that was assumed during the acquisition.
“We believe exploring strategic options now will clearly position the next buyer to strategically capitalize on the next phase of growth of the Global Marine business, while allowing current investors an opportunity to realize substantial value creation since the acquisition in 2014.”
He added that reducing HC2’s debt cost of capital is a priority and “monetizing this asset will get us above and beyond that important goal”.
Global Marine re-entered the offshore power market through the acquisition of CWind in 2016, pursuing growth opportunities in construction and operations, installation, repair and maintenance services.
It also created CWind Taiwan, a joint venture with IOVTEC, to pursue offshore wind opportunities in the Asia Pacific.
Following the acquisition of Fugro’s trenching and cable laying business in exchange for an equity stake in Global Marine by Fugro in 2017, Global Marine won and delivered several offshore power cable installation projects and is currently building a pipeline of work in this market.
Falcone said: “We’ve been delighted to be part of the Global Marine journey and having reviewed what we believe are incredible prospects for this business, we believe that now is the right time to explore strategic alternatives to support the growth trajectory of the business set by executive chairman Dick Fagerstal and long-term chief executive Ian Douglas.”
Douglas said: “We very much welcome this decision from HC2 to explore strategic options to support the continued growth of the Global Marine Group platform.
“Together, we have strengthened the business and grown across our target markets, and we believe we have a great opportunity to accelerate our growth with our experienced and proven management team, strong balance sheet, enhanced and upgraded portfolio of marine assets and a solid pipeline of secured and potential project opportunities.”