Singapore’s construction and support services provider Swiber has received an S$256.2m ($206.31m) offer from investment firm SEA9 for its 57.5% stake in Kreuz, an offshore subsea services division of Swiber.

SEA9, together with its subsidiary, the SEA9 Group proposes acquiring all the issued and paid-up ordinary shares in Kreuz by way of a scheme of arrangement for S$0.80 per ordinary shares.

According to Swiber, the offer in cash for each share represents a premium of about 78.4% over Kreuz’s NAV per share as at 30 September 2013.

Swiber holds 320,250,000 Kreuz shares, representing about 57.5% of the issued and paid-up share capital of Kreuz, and is set to record a net gain of approximately $90.6m from the proposed disposal.

The company will use the cash proceeds as working capital to fund the operations of the group’s core businesses.

Furthermore, cash proceeds from the disposal will also be used to undertake future business expansions, acquisitions and new investment opportunities.

Swiber group chief executive officer and president Francis Wong said: "The completion of the proposed disposal will unlock further value for all shareholders of Swiber given that the Scheme is at a premium of 39.6% over the 12-month volume weighted average price of Kreuz Shares."

Upon completion of the proposed disposal, which is subject to approval of the shareholders of Swiber, Kreuz will cease to be the company’s subsidiary.

The transaction is expected to allow Kreuz to continue to develop and execute upon new growth initiatives, such as investing in new vessels in a bid to support the business.

Kreuz CEO and executive director Kurush Contractor said: "The incoming delivery of a state-of-the-art Diving Support Vessel, will enhance Kreuz’s capabilities in shallow, deep and ultra deep offshore operations globally, and support Kreuz as it seeks to execute upon its growth initiatives."

Image: Proceeds from the disposal of subsea services provider Kreuz will be used for future business expansions and acquisitions. Photo courtesy of num_skyman /