Tidewater and Helix Close Offshore Deals a Day Apart as Consolidation Runs On
A $500m Brazilian acquisition and a merger that renames the buyer both completed at the end of August
Two United States offshore service companies completed transactions a day apart at the end of August, extending a wave of consolidation that has been reshaping the sector's ownership as it responds to changing demand and geographic concentration.
Tidewater, based in Houston, closed its acquisition of Brazil's Wilson Sons Ultratug and its affiliate Atlantic Offshore Services on 31 August, having first announced the deal in February. It put an enterprise value of $500m on the transaction including the assumption of debt. The purchase brings in 22 platform supply vessels and expands the company's position in Brazil, which it has described as perhaps its most attractive market opportunity, both for the scale of the offshore industry there and for the structure of the local vessel market. Almost 90 percent of the acquired fleet was built in Brazil.
"The agreement to acquire WSUT marks yet another important milestone in the continued evolution of Tidewater," said Quintin Kneen, the company's president and chief executive officer, when the deal was announced. At that point Tidewater anticipated a combined fleet of 28 ships in Brazil and a total of 213 offshore vessels, with a global fleet projected at 231 units including crew boats, tugs and maintenance vessels.
The second transaction changes a listed company's name. Helix Energy Solutions Group shareholders approved the proposals needed to complete an all-stock combination with Hornbeck Offshore Services at a special meeting on 31 August, and the merged business took the Hornbeck Offshore Services name from 1 September, trading on the New York Stock Exchange under the ticker HOS in place of Helix's HLX.
Hornbeck securityholders own roughly 55 percent of the combined company and Helix shareholders roughly 45 percent on a fully diluted basis, on a fixed exchange ratio of 10.27167 Helix shares for each Hornbeck share. The companies announced the definitive agreement on 23 April, and Ares Management funds, which hold a significant portion of Hornbeck's ownership, delivered written consent at that time.
The combined company keeps dual headquarters in Covington, Louisiana and Houston. Todd Hornbeck serves as president and chief executive, with a seven-member board made up of four Hornbeck directors and three from Helix, and William L. Transier as chairman. The companies have projected $75m or more in annual revenue and cost synergies within three years of closing, drawn from integrated service offerings, fleet optimisation, reduced reliance on third-party charters, and efficiencies in maintenance, procurement and operations.
The geographic fit is the clearest part of the logic. Helix brings well intervention assets, subsea robotics and trenching work across West Africa, the Asia Pacific, the North Sea, the United States and Brazil, while Hornbeck's specialty and ultra-high specification support vessel fleet is concentrated in the Americas, including Brazil and Mexico.
