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SEACOR Marine: new joint venture to acquire UP Offshore

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Oilfield Technology,

SEACOR Marine Holdings Inc. (‘SEACOR Marine’) has announced the acquisition of UP Offshore (Bahamas) Ltd. (‘UP Offshore’) by a new joint venture company that is 49% owned by a subsidiary of SEACOR Marine and 51% owned by a subsidiary of Proyectos Globales de Energía y Servicios CME, S.A. de C.V. (‘CME’).

UP Offshore is a leading provider of offshore support vessel services to the energy industry in Brazil, the largest regional market in Latin America. Of UP Offshore’s 14 vessel fleet, 12 vessels are located in Brazil and registered under the Brazilian flag. Nine are platform supply vessels, four are ROV support vessels and one is an offshore terminal vessel.

The equity of UP Offshore was acquired for nominal consideration and its debt was refinanced with approximately US$95 million of new indebtedness composed of:

  • S$70 million in the form of a new six-year debt facility provided by UP Offshore’s existing lenders. The new facility is non-recourse to SEACOR Marine and CME or any of their respective subsidiaries;
  • A US$15 million loan to UP Offshore from Mantenimiento Express Marítimo, S.A.P.I. de C.V. (‘MEXMAR’), an existing joint venture in Mexico between affiliates of SEACOR Marine and CME. This loan will be used to fund capital expenditures on two vessels in the UP Offshore fleet that have been awarded firm contracts of employment in Brazil. Except under certain limited circumstances, this loan is senior to the new bank facility in right of payment; and
  • A US$10 million loan from the new joint venture company of SEACOR Marine and CME to fund working capital requirements of UP Offshore. This loan is subordinate to the new bank debt facility and will be funded with an approximate US$5 million capital contribution from subsidiaries of each of SEACOR Marine and CME.

John Gellert, SEACOR Marine’s Chief Executive Officer, and Alfredo Miguel, President of CME and MEXMAR, in a joint statement, commented: “We are pleased to expand our partnership and are excited to create a unique offshore services group with local presence in the major markets of Latin America. During the past seven years, we have grown MEXMAR to a fleet of 15 vessels, all documented and registered in Mexico, and through our new joint venture, we will now have a meaningful presence in Brazil. In acquiring UP Offshore, we were able to use our joint venture capital efficiently and plan to integrate a strong platform in Latin America into SEACOR Marine’s global network. The UP Offshore transaction demonstrates the benefit of lenders and operators working together.”

DNB Markets, Inc. acted as advisor to MEXMAR in this transaction. Clarksons Platou Securities AS acted as advisor to UP Offshore.

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