Austal signs agreement to buy BSE Maritime Solutions

23 October 2020 (Last Updated October 23rd, 2020 18:05)

Austal has signed an agreement to buy Australia-based BSE Maritime Solutions Group for an enterprise value of A$27.5m ($19.5m).

Austal signs agreement to buy BSE Maritime Solutions
Austal to expand Australia support business through acquisition of BSE Maritime Solutions. Credit: Austal

Austal has signed an agreement to buy Australia-based BSE Maritime Solutions Group for an enterprise value of A$27.5m ($19.5m).

Operating in Cairns and Brisbane, BSE Maritime Solutions is a ship repair and support business for customers in defence, commercial, tourism, and luxury vessel markets.

Its customers include BAE Systems, Thales, Australian Border Force, and Svitzer.

The company employs approximately 60 people, who will now be part of Austal.

The deal aligns with Austal’s strategy of building its key support business.

Revenue from the company’s support segment has increased at an annual rate of 28% in the last four years to touch $360m in 2020, offering an ongoing and dependable revenue, along with the company’s shipbuilding operations.

Austal CEO David Singleton said: “BSE Maritime Solutions is a quality business and its acquisition aligns with our stated strategy of growing our support division, adding further scale to our operations on the east coast of Australia in addition to our existing support services at Henderson, Cairns, and Darwin.

“In particular, the acquisition provides Austal with dockyard and ship lift capability in the northeast region of Australia, including the Pacific’s largest mobile boat hoist, capable of moving 1,120t, supporting our existing and future customers and reinforcing our commitment to grow in the region.

“It further enhances our in-service support capabilities, currently provided across multiple facilities in Cairns, for the Austal designed and constructed Cape-class and Guardian-class Patrol Boats.”

Austal expects BSE to help generate an EBITDA of A$5m in FY2021, rising to A$11m by FY2025.

According to the agreement, Austal will buy all of the shares in BSE Maritime Group, Brisbane Slipway Holdings, and Brisbane Slipways and Engineering.

Austal will fund the acquisition from its cash reserves, with the company holding a $272.4m net cash position.

The deal is subject to customary conditions and is expected to be completed at the end of November.