(Alliance News) - Gulf Marine Services PLC on Tuesday said it has signed a "significantly improved" debt agreement which will save the company around USD53 million over 2021 and 2022.
Gulf Marine shares closed up 22% at 7.16 pence in London on Tuesday.
The new arrangements cut GMS's interest rate to Libor plus 3% from the start of this year until the end of 2022.
Abu Dhabi-based GMS, which provides support vessels to the offshore energy industry, has been given until the end of 2022 to raise USD75 million in equity as part of a restructuring. The previous deadline was December 31, 2020. Two shareholders, Seafox International and Mazrui Investments, have agreed to participate in the equity raise.
"In this context, the board would like to thank the two shareholders for their extensive work and support to deliver this improved debt deal, which is a milestone for the business," said GMS.
Meanwhile, GMS's underlying performance in 2020 was in line with expectations, with "solid revenue progress and an improved margin," GMS said. There has been a "pickup in tender activity in the European Renewables market and the Middle East Oil & Gas market." However, it does expect to write down the value of of its barges by USD80 million to USD90 million.
"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 pickup across its core markets," Executive Chair Mansour Al Alami said.
By Ivan Edwards; ivanedwards@alliancenews.com
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Gulf Marine Services (GMS)