Norway’s Kjell Inge Rokke is taking control of Solstad Offshore in its latest refinancing deal.
A parent company called Solstad NewCo is being created with new equity that will see the offshore vessel owner grow, Solstad and Rokke’s Aker Capital said on Monday.
Aker already had 24.84% of the company, but the stake will grow to about 57% of Solstad NewCo.
The transaction also involves Aker-backed AMSC, formerly American Shipping Co, which owns the Solstad-chartered 178-loa offshore construction vessel Normand Maximus (built 2016), DNB and Export Finance Norway (Eksfin).
The deal is described as an “overall refinancing solution which will create a robust industrial platform”.
A new loan worth NOK 9.7bn ($875m) will be underwritten by DNB and Eksfin to refinance the fleet fully. This matures over three years with two one-year options, and will replace NOK 11.9m of debt held currently.
Solstad NewCo will be formed with a total of NOK 4bn in new equity.
Aker is pumping in at least NOK 2.25bn, there will be a private share placement of NOK 750m, and AMSC will contribute the Normand Maximus for NOK 1bn of shares.
Solstad said the refinancing situation was “challenging”.
“Due to the complex nature of Solstad’s current liabilities, including a residual claim from former lease arrangements with respect to CSV Normand Maximus, the refinancing entails the establishment of the Solstad NewCo structure,” the company added.
Fuelling future growth
Solstad chief executive Lars Peder Solstad said the new deal will allow future growth in the projected strong offshore market.
“Aker has been an instrumental contributor to the Solstad Group from day one, and without Aker’s support, both over the past years and going forward, this refinancing would not have been possible,” he added.
Anchor-handler and construction vessel specialist Solstad is expecting Ebitda of between NOK 2.6bn and NOK 2.8bn for 2023, rising to between NOK 3.3bn and NOK 3.5bn in 2024.
Debt will be as much as NOK 7.9bn at year-end.
Solstad will retain a 27% interest in Solstad NewCo.
Another Oslo stock exchange filing reveals Norwegian investor Christen Sveaas bought 2.4m Solstad shares on Friday, lifting his stake to 13.1%, the second largest.
Sveaas controls Western Bulk and Viking Supply Ships.
Solstad made a net profit of NOK 134m in the second quarter, reversing a NOK 1.18bn loss a year earlier.
The company sold its platform supply vessel fleet to US owner Tidewater this year.
This is its third major reorganisation in six years, following a $2bn debt restructuring in 2020 and a 2017 deal that saw John Fredriksen’s Deep Sea Supply and domestic owner Farstad Shipping merged into Solstad in a transaction also involving tycoon Rokke.
Solstad had already taken over Rem Offshore following the slump in the offshore support vessel market.
