Solstad Farstad, the OSV behemoth formed a year ago, is looking to sell what it describes as non-core assets.
In its Q4 2017 results, announced last week, Solstad Farstad, which was formed 12 months ago from the merger of Solstad Offshore, Farstad, Deep Sea Supply and Rem Offshore, confirmed it has initiated a process to sell out parts of its non-core fleet.
The company said a successful sale would have a significant impact on group liquidity and would in particular benefit one of its non-recourse subsidiaries – which it did not name – where the liquidity “has shown a more negative development than expected.”
From a financial risk perspective, the company is organised as four separate entities; with no parent company guarantees issued by Solstad Farstad on behalf of former Rem Offshore, Farstad Shipping or Deep Sea Supply.
The company said the process “has secured interest from both industrial and financial players” but so far no transaction has been concluded. It continues to evaluate and discuss different options with relevant stakeholders and third parties.
Solstad Farstad said “In light of the low cash position in one of the subsidiaries, this will also include discussions with the lenders of such subsidiary in order to find a sustainable solution.”
The company is working on alternative ‘strategic opportunities’ including further consolidation of the OSV industry.
Solstad Farstad said low demand and too many vessels have had a significant negative effect on the global offshore vessel market in recent years, resulting in low rates, low utilisation and a large number of vessels in layup. However, it said a recent increase in the tender activity gives reason to believe that the market has bottomed out, and that activity will continue to grow going forward.”