Hornbeck Offshore Services (HOS) has agreed to sell the tug and tank barge (TTB) fleet of its downstream segment to Genesis Marine for $230m.
Genesis Marine, an affiliate of Genesis Energy (GEL), has deposited $23m to acquire the fleet of downstream vessels, which include nine oceangoing tugs and nine double-hulled barges.
Hornbeck Offshore intends to use the after-tax proceeds from the deal for the retirement of debt or funding the purchase, construction or retrofit of vessels.
Subject to customary closing conditions and regulatory clearances, including the expiration or termination of the waiting period under the US Hart-Scott-Rodino Act, the deal is expected to be completed by the end of the third quarter of 2013.
JP Morgan Securities acted as exclusive financial advisor to Hornbeck Offshore for the deal.
HOS chairman, president and chief executive officer Todd Hornbeck said: "Given the substantial pending growth in our Upstream fleet over the next few years, as a result of previously announced newbuild and retrofit programs and any incremental organic or acquisitive growth that may arise, we believe that the timing is right to divest of our non-core Downstream segment in order to strategically focus our energies on our Upstream core business."
HOS, which provides new generation offshore supply vessels primarily in the US Gulf of Mexico and Latin America, currently has a fleet of 76 vessels serving the energy industry and 23 additional high-spec upstream vessels under construction that are scheduled to be delivered before the end of 2016.
The company also transports petroleum products via its coastwise fleet of ocean-going tugs and tank barges in the north-eastern US and the US Gulf of Mexico.
Genesis Energy said the deal will help the company boost its fleet and complement its inland barge business, comprised of 50 barges and 23 push/tow boats, storage and blending terminals and its oil pipeline systems.
Genesis chief executive officer Grant Sims said that the deal will expand the company’s marine transportation capabilities as they complement the inland waterway operations as well as other crude oil and heavy refined product assets.
"There is a significant overlap in existing customers and we look forward to working with Hornbeck to facilitate a seamless transition for our collective customers and employees," Sims said.