Fugro is pleased with today’s press release from HC2 Holdings, Inc. (HC2), announcing the sale of Global Marine Group (GMG). Through its ownership of 23.6% in GMG, Fugro will monetise the remainder of its non-core interest in GMG, which is expected to result in proceeds for Fugro of close to USD 40 million.

A subsidiary of Global Marine Holdings, LLC, in which Fugro holds a 23.6% equity interest, has entered into a definitive agreement to sell 100% of GMG, excluding GMG’s 49% joint venture with Huawei Marine Networks Co., Limited (HMN), to an investment affiliate of J.F. Lehman & Company, LLC (JFLCO) for a total base consideration for 100% of GMG of approximately USD 250 million in cash, subject to customary closing adjustments, plus a potential future earn-out should JFLCO and its investment affiliates achieve a specified multiple of their invested capital. After repayment of approximately USD 97 million of pension and debt obligations at GMG, as well as other customary closing adjustments, taxes and transaction fees, Fugro’s share in this transaction is expected to be close to USD 40 million. The transaction is expected to close by the end of the first quarter of 2020.

Mark Heine, CEO: “I am very pleased with this transaction, which has been very professionally led by the GMG management. It is an important step towards monetising our non-core activities. This divestment will enable us to focus further on our core business and deliver on our Path to Profitable Growth strategy.”

This announcement follows an earlier release, from 30 October 2019, about the sale of GMG’s 49% stake in HMN to Hengtong Optic-Electric Co Ltd, in a transaction that values Fugro’s stake in HMN at approximately USD 33 million. Initially, 30% of HMN (which represents a value of approximately USD 20 million for Fugro) will be sold. The remaining 19% of HMN that is under a two-year put-option agreement will remain as an indirect subsidiary of HC2 and Fugro . Completion of the 30% tranche of this transaction continues to be expected in the first quarter of 2020.

Fugro’s share of the net proceeds from the divestment of its stake in GMG and HMN is approximately USD 73 million in total and is expected to lead to a positive transaction result. The proceeds will be utilised to reduce Fugro’s outstanding debt position.