Fairstar Heavy Transport N.V. (FAIR) announced today the award of a new contract to transport the jack-up drilling rig OFFSHORE VIGILANT from Port of Spain, Trinidad to Vung Tau, Vietnam on Fairstar’s semi-submersible vessel FJELL. The contract value is USD $2.9 million and the loadout is expected to commence at the end of MAY.
Willem Out, COO of Fairstar, commented:
“It is business as usual at Fairstar. This voyage positions FJELL almost perfectly to be in the Far East just in time to begin her work on the Gorgon contract in August. Once the rig has been safely discharged, we will put FJELL into dry-dock and prepare the ship for Gorgon certification.”
FJELL has just safely discharged two concrete power generating barges for the Chevron EGTL project in Escravos, Nigeria and is en route to Port of Spain.
Facing a hostile takeover by heavy lift giant Dockwise, business at Fairstar appears anything but “usual” however.
In another announcement today, Fairstar informed Dockwise:
The unsolicited financial proposal received from Dockwise is of no interest to Fairstar. Dockwise has attempted to characterize the offer of USD 30 million in “subordinated debt” to be an attempt by Dockwise to be helpful. However, a close reading of the Dockwise proposal revealed it to be another opportunistic device to try and lock in a NOK 9.3 ceiling for Fairstar shares. Fairstar does not consider “poison pills” of any sort to be appropriate tools in the proper management of our Stakeholders’ interests.
Fairstar’s comments stem from Dockwise’ statement,
“The financial situation of Fairstar is concerning and therefore at the AGM, Dockwise offered again to the Fairstar Boards to discuss how Dockwise could assist Fairstar with its financing. Dockwise had before repeatedly stated to the Fairstar Boards that it is willing and able to discuss with Fairstar the terms of required financing including a potential capital injection of USD 50-100 MM.”
Which was then followed by Dockwise’s offer,
“To assist in Fairstar’s short term financing needs by providing a USD $30 million subordinated loan, for a period of up to 3 years, with interest of 1% over LIBOR for the first 2.5 months and 6% over LIBOR thereafter, to bridge the period to an equity offering of between 20 and 60 million shares, at NOK 9.30, with full protection of the pre-emptive and other rights of all the Fairstar shareholders. The proposed USD $30 million short term financing would be part of the potential overall capital injunction by Dockwise of USD $50-100 million referred to above.”