Gulf Island Fabrication, Inc. Announces Agreement to Acquire LEEVAC Shipyards’ Assets
Gulf Island Fabrication, Inc. (NASDAQ: GIFI) today announced that Gulf
Island has executed an asset purchase agreement with LEEVAC Shipyards,
LLC and its related affiliates (collectively, “LEEVAC”) under which
LEEVAC will sell to a Gulf Island subsidiary substantially all of
LEEVAC’s assets, including LEEVAC’s leasehold interests at its marine
fabrication facilities in Jennings, Louisiana and Lake Charles,
Louisiana, and substantially all of LEEVAC’s machinery and equipment. In
addition, the transaction would provide approximately $112.0 million of
incremental contract backlog. The purchase price is $20.0 million. The
potential transaction is subject to a working capital adjustment under
which Gulf Island would receive at closing a dollar for dollar reduction
for the assumption of certain net liabilities of LEEVAC and settlement
payments from sureties on certain ongoing fabrication projects that will
be assigned to Gulf Island in the transaction. After taking into account
these adjustments, Gulf Island expects to pay a nominal amount of cash
at closing and may, in the alternative, receive cash at closing. The
potential transaction is subject to certain customary closing conditions
and is expected to close at the end of the fourth quarter of 2015 or
beginning of the first quarter of 2016.
Kirk Meche, President and Chief Executive Officer of Gulf Island, stated
that “the acquisition of the LEEVAC assets further diversifies our
business, enhances our marine fabrication and maintenance and repair
capabilities, and provides our company with facilities in key strategic
locations of Lake Charles and Jennings, Louisiana.”
PPHB, LP acted as exclusive financial advisor to Gulf Island in the
transaction. Gulf Island was advised on legal matters exclusively by
Jones Walker LLP.
Gulf Island Fabrication, Inc., based in Houston, Texas, with fabrication
facilities located in Houma, Louisiana, and San Patricio County, Texas,
is a leading fabricator of offshore drilling and production platforms,
hull and/or deck sections of floating production platforms and other
specialized structures used in the development and production of
offshore oil and gas reserves. These structures include jackets and deck
sections of fixed production platforms; hull and/or deck sections of
floating production platforms (such as tension leg platforms “TLPs”,
“SPARs”, “FPSOs”, and “MinDOCs”), piles, wellhead protectors, subsea
templates and various production, compressor and utility modules,
offshore living quarters, towboats, liftboats, tanks and barges. The
Company also provides offshore interconnect pipe hook-up, inshore marine
construction, manufacture and repair of pressure vessels, heavy lifts
such as ship integration and TLP module integration, loading and
offloading of jack-up drilling rigs, semi-submersible drilling rigs,
TLPs, SPARs, or other similar cargo, onshore and offshore scaffolding,
piping insulation services, and steel warehousing and sales.
Cautionary Statements
This press release includes forward-looking statements that are
generally identifiable through the use of words such as “believe,”
“expect,” “intend,” “plan,” “estimate,” “anticipate,” “project,” “will”
and similar expressions. These forward-looking statements rely on
assumptions, estimates and predictions that could be inaccurate and that
are subject to risks and uncertainties that could cause actual results
to differ materially from Gulf Island’s goals or forecasts. These
risks and uncertainties include, but are not limited to: the
occurrence of any event, change or other circumstances that could give
rise to the termination of the asset purchase agreement; the inability
to complete the transaction due to the failure to satisfy any of the
conditions to completion of the transaction; the effect of the
announcement of the transaction on Gulf Island’s relationships
with its customers, operating results and business generally; the
effects of local and national economic, credit and capital market
conditions; and other risk factors described in Gulf Island’s Annual
Report on Form 10-K for the year ended December 31, 2014 filed with the
Securities and Exchange Commission. Gulf Island disclaims any
obligation or intent to update or revise any forward-looking statements
in order to reflect events or circumstances after the date of this
release.
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