MMA secures Neptune acquisition on back of improving market

The MMA Prestige. Image: MMA Offshore

Australian marine support company MMA Offshore has agreed to acquire subsea services provider Neptune Marine Services for at least $18.5 million.

The sale, which is subject to shareholder approval, is expected to cost $18.5 million,  including $5 million in cash and $13.5 million in shares.

It could, however, could cost as much as $21.2 million depending on MMA’s volume weighted average share price prior to completion of the transaction.

Perth-based Neptune provides repair, inspection and maintenance solutions (including commercial diving) for sectors such as the oil and gas, renewable energy and marine industries.

MMA managing director Jeffrey Weber said the combined business would benefit from the recovery in offshore and subsea investment as the offshore market improved.

“Importantly, the services that (Neptune) provides do not directly compete with our existing clients in the sector and we continue to see these partnerships as a key platform in our subsea strategy going forward,” Weber said.

“The acquisition is expected to enhance MMA’s return on assets through packaging value adding services to our vessels.”

MMA Offshore employs more than 1000 staff and operates a fleet in excess of 30 vessels across Australia, the Asia Pacific, South East Asia, India, Africa and the Middle East.

Neptune, which has faced “significant challenges” in the subsea market in recent years (despite recent improvements), stated that injecting the company’s subsea operations into MMA would provide a strong fit with their complementary regional presence across Australia and South East Asia.

Robin King, Neptune chief executive officer,  said the combination of the company’s subsea equipment and technical expertise with MMA’s vessel assets should result in a stronger service offering for both companies’ existing clients.

Once the transaction is completed, Neptune will also seek approval at a shareholder general meeting to change its name.

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