1 April 2021
Gulf Marine Services PLC
('Gulf Marine Services', 'GMS', 'the Company' or 'the Group')
New Debt Deal
GMS, a leading provider of advanced self-propelled, self-elevating support vessels serving the offshore oil, gas and renewables industries, is pleased to confirm that it and all of its banks have executed an amendment to its common terms agreement and related loan documentation to amend certain terms consistent with the term sheet announced by the Company on 16 March 2021.
Amended Debt Agreement:
Under the revised agreement the rate of interest payable by the Company on its borrowings will decrease from LIBOR +5% to LIBOR +3%, retrospectively from the beginning of this year. The reduced interest rate will apply until the end of 2022, after which the existing ratchet will apply.
Additional time has been granted to the Company to raise equity or (in the alternative) issue warrants. The previous PIK structure and deadlines for the issuance of warrants to the banks no longer apply; instead, providing the Company raises equity capital of a net $25m or more no later than 30 June 2021 (the "Equity Raise"), and raises further equity capital by 31 December 2022, taking the combined fund raising to at least a net $75m, it will not be required to issue any warrants nor will any PIK interest accrue. Any such proceeds raised will be used to reduce the Company's debt liabilities.
Mansour Al Alami GMS Executive Chairman said:
"This new agreement with the banks is on vastly improved terms to what was agreed in June last year. As a result, it creates a positive platform on which the future development and growth of the business can be based; allowing the Company to benefit from the pick-up across its core markets.
This revised structure provides the time needed to seek to complete the $75m equity raise, as well as review alternative options to optimise the capital structure, including a refinancing, by the end of 2022, should GMS be able to deleverage the balanced sheet and improve its Net Debt to EBITDA profile."
This announcement contains inside information for the purposes of article 7 of the Market Abuse Regulation (EU) 596/2014 ("MAR"), which is part of UK law by virtue of the European Union (Withdrawal) Act 2018.
Mansour Al Alami
Tel: +44 (0)20 7603 1515
Tel: +44 (0)20 8434 2643
Notes to Editors:
Gulf Marine Services PLC, a company listed on the London Stock Exchange, was founded in Abu Dhabi in 1977 and has become a world leading provider of advanced self-propelled self-elevating support vessels (SESVs). The fleet serves the oil, gas and renewable energy industries from its offices in the United Arab Emirates, Saudi Arabia and Qatar. The Group's assets are capable of serving clients' requirements across the globe, including those in the Middle East, South East Asia, West Africa, North America, the Gulf of Mexico and Europe.
The GMS fleet of 13 SESVs is amongst the youngest in the industry, with an average age of eight years. The vessels support GMS's clients in a broad range of offshore oil and gas platform refurbishment and maintenance activities, well intervention work and offshore wind turbine maintenance work (which are opex-led activities), as well as offshore oil and gas platform installation and decommissioning and offshore wind turbine installation (which are capex-led activities).
The SESVs are categorised by size - K-Class (Small), S-Class (Mid) and E-Class (Large) - with these capable of operating in water depths of 45m to 80m depending on leg length. The vessels are four-legged and are self-propelled, which means they do not require tugs or similar support vessels for moves between locations in the field; this makes them significantly more cost-effective and time-efficient than conventional offshore support vessels without self-propulsion. They have a large deck space, crane capacity and accommodation facilities (for up to 300 people) that can be adapted to the requirements of the Group's clients.
Evolution Cantilever Capability
GMS Evolution and her cantilever work over system has been designed and built to enable heavier work over scopes from a self-propelled jack up barge. The optimised design enables execution of Heavy Well Intervention (HWI) benefitting from the efficiencies of our 4-Legged self-propelled jack up barges provide. The type of HWI work that can be carried out include:
Electrical Submersible Pump (ESP) change out
· Plug and abandonment:
· Slot Recovery
· Work Overs
· Coil Tubing
And the benefits include:
· Significant time savings moving between locations resulting in workover programmes being completed significantly quicker therefore allowing clients to maximise production levels
· No requirement to hire tugs to assist with drilling rig moves
Gulf Marine Services PLC's Legal Entity Identifier is 213800IGS2QE89SAJF77
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This announcement includes statements that are forward-looking in nature. All statements other than statements of historical fact are capable of interpretation as forward-looking statements. These statements may generally, but not always, be identified by the use of words such as 'will', 'should', 'could', 'estimate', 'goals', 'outlook', 'probably', 'project', 'risks', 'schedule', 'seek', 'target', 'expects', 'is expected to', 'aims', 'may', 'objective', 'is likely to', 'intends', 'believes', 'anticipates', 'plans', 'we see' or similar expressions. By their nature these forward-looking statements involve numerous assumptions, risks and uncertainties, both general and specific, as they relate to events and depend on circumstances that might occur in the future.
Accordingly, the actual results, operations, performance or achievements of the Company and its subsidiaries may be materially different from any future results, operations, performance or achievements expressed or implied by such forward-looking statements, due to known and unknown risks, uncertainties and other factors. Neither Gulf Marine Services PLC nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. No part of this announcement constitutes, or shall be taken to constitute, an invitation or inducement to invest the Company or any other entity and must not be relied upon in any way in connection with any investment decision. All written and oral forward-looking statements attributable to the Company or to persons acting on the Company's behalf are expressly qualified in their entirety by the cautionary statements referred to above.