Singapore-listed offshore support vessel (OSV) operator PACC Offshore Services Holdings (POSH) is set to acquire the 50% of Pacific Workboats it did not already own.
It will purchase the 50% stake held by Sembcorp Marine’s subsidiary Dolphin Shipping Co in one of the biggest deals in the towage sector in the last five years.
Pacific Workboats operates a fleet of harbour tugs, mainly in Singapore, Malaysia, Vietnam and New Caledonia, and heavy-lift floating cranes.
This acquisition is expected to be completed by the end of this year, “conditional upon, among others, a dividend distribution by Pacific Workboats to POSH and Dolphin, which will be satisfied through a distribution of assets, comprising primarily of vessels,” said POSH.
Pacific Workboats will then cease to be a joint venture of POSH and will become a wholly-owned subsidiary of POSH. This acquisition is in line with POSH’s ongoing comprehensive review of its businesses and investments.
POSH’s diversification into harbour services is a long-term solution to expand its business. It comes at a time when tug operations are becoming more appealing, said POSH chief executive Lee Keng Lin.
“This decision on Pacific Workboats marks another proactive step forward in our comprehensive business review, as we continue to sharpen our strategy and be better positioned for our next phase of growth,” he said.
Mr Lin suggested POSH would continue investing in the harbour towage business. “The prospects for the harbour services sector remain attractive,” he said. “We look forward to this next chapter and will work to grow our business both in Singapore and abroad.”
The Pacific Workboats acquisition is not expected to have any material impact on the net tangible assets per share and earnings per share of POSH for the financial year ending 31 December 2019.