Sevan Marine ASA (SEVAN) agreed to sell an equity stake and three of its vessels to Teekay Corp. (TK) as the Norwegian owner of floating oil production and storage vessels seeks to avoid bankruptcy. Sevan shares surged.
Teekay will buy a “significant” stake through new shares, Arendal-based Sevan Marine said today in a statement. It will acquire three floating production, storage and offloading units, their charter contracts and finance the completion of the Sevan Voyageur upgrade, the company said. Financial terms are expected to be released next week, Hamilton, Bermuda-based Teekay said in a separate statement.
“The proposed transaction with Teekay represents a good solution for all stakeholders,” Sevan Marine Chief Executive Officer Carl Lieungh said in the statement. “We will also preserve our leading engineering and design capabilities and intellectual property.”
The agreement is subject to approval by Sevan bondholders, shareholders and leaseholders. The company has struggled with larger-than-expected maintenance costs on its Sevan Voyageur vessel, which are expected to reach $190 million, compared with an earlier $135 million forecast. Sevan Marine has been in talks with bondholders to stave off bankruptcy after reaching an agreement in July to defer interest until the end of this month.
Sevan Marine rose as much as 87 percent and was up 0.18 krone at 0.48 kroner, before trading was suspended as 9:59 a.m. in Oslo. The stock has lost 93 percent this year.
“This is an important transaction for the FPSO industry,” Teekay CEO Peter Evensen said in the statement “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.”
Teekay, an oil tanker company that transports about 10 percent of the world’s seaborne oil, also operates FPSOs through its Petrojarl unit, which it took control of in 2006.
Norwegian Energy Co., Premier Oil Plc (PMO) and EON AG, the operator of the Huntington field, have a lease agreement with Sevan Marine for its Sevan Voyageur vessel. Production is scheduled to start in the first quarter of 2012.
The Sevan Voyageur sale “should hopefully feed into positive sentiment” for Premier and partners’ plans to develop the Huntington field, Phil Corbett, an analyst at Royal Bank of Scotland Group, wrote in an e-mailed report. The “lack of clarity around Huntington first oil has weighed” on Premier’s production plans and share price, he said.
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