ST Engineering to divest all equity interest in U.S. marine businesses for $21m
Its US subsidiaries are VT Halter Marine and Bollinger Shipyards Lockport, L.L.C..
ST Engineering will exit its marine business in the United States with the planned divestment of its entire issued and outstanding equity interests in VT Halter Marine, Inc. (Halter Marine) and Bollinger Shipyards Lockport, L.L.C. (Bollinger) for $21m (US$15m).
In a bourse filing, ST Engineering said the divestment will be on a" cash-free, debt-free basis, subject to net working capital adjustments, if any, post-closing."
ST Engineering said it may also receive "earnout payments post-closing of up to an aggregate amount of US$10.25m, subject to the award of certain future shipbuilding contracts to Halter Marine and such contracts meeting the requisite operating profit margins."
“We have experienced challenges and losses in the past years operating the two U.S. shipbuilding and ship/rig repair businesses. After a thorough review of strategic alternatives,
we made this difficult decision to exit the U.S. Marine business,” said ST Engineering Group
President & CEO, Vincent Chong.
In the last five years, from 2017-2021, Halter Marine and Bollinger incurred a combined net loss before tax of US$256m ($349m), with an annual net loss before tax that ranged from about US$40m ($56m) to US$60m ($85m).