The Falkland Islands tug boat fleet of the Howard Smith Group has become part of the largest harbour towage company in the world.
This follows the announcement that Adsteam Marine Limited ("Adsteam Marine") has entered into an agreement to acquire the Australian and United Kingdom harbour towage and related marine businesses of Howard Smith Towage for A$500 million. The agreement is subject to the ACCC advising that it will not intervene in the acquisition.
Adsteam Marine, based in Sydney, Australia, will acquire ownership of the remaining 50% of its Australian towage Joint Ventures with Howard Smith as well as ownership of Howard Smith's wholly-owned Australian and United Kingdom towage businesses.
"The acquisition will transform Adsteam Marine into the largest independent harbour towage company in the world, serving a global customer base," Adsteam Marine's Managing Director, Mr David Ryan, said today.
The acquisition will be financed by a A$330 million bank debt facility from National Australia Bank and an equity raising of A$180 million. The equity raising will be jointly underwritten by ABN AMRO Rothschild and UBS Warburg.
"The transaction is in line with Adsteam Marine's previously stated objective of using strategic international acquisitions to grow its harbour services operations into a global business," Mr Ryan said.
Mr Ryan said that the overlap between Adsteam Marine and Howard Smith Towage's customers in both the United Kingdom and Australia would give Adsteam significant opportunities as the global shipping industry continues to consolidate.
The Howard Smith Towage acquisition will re-inforce Adsteam Marine's strong presence in the Pacific region, while gaining a base for future growth in Europe. Adsteam Marine has aggressively expanded its global reach in the past year, including:
Establishing a strong United States market position, through the February 2000 acquisition of 50% of Seattle-based maritime services group, Northland Holdings Inc, for US$58.4 million;
The acquisition through Northland in August 2000 for US$26.5 million of the Alaskan-based Bethel Fuel Sales fuel distribution business; and Securing in October last year, a 50% stake in New Zealand-based Sea-Tow Limited, the premier tug and barge group in the New Zealand/South Pacific region.
Mr Ryan said the acquisition of the Howard Sm