Gulf Island takes over Leevac
Gulf Island Fabrication has bought Leevac Shipyards, and its related affiliates, for $20 million.
Gulf Island says that, under the agreement, Leevac will sell to a Gulf Island subsidiary substantially all of Leevac’s assets, including Leevac’s leasehold interests at its marine fabrication facilities in Jennings, Louisiana and Lake Charles, Louisiana, and substantially all of Leevac’s machinery and equipment.
In addition, the transaction would provide approximately $112 million of incremental contract backlog. The purchase price is $20 million.
The potential transaction is subject to a working capital adjustment under which Gulf Island would receive at closing a dollar for dollar reduction for the assumption of certain net liabilities of Leevac and settlement payments from sureties on certain ongoing fabrication projects that will be assigned to Gulf Island in the transaction, Gulf Island said on Wednesday.
After taking into account these adjustments, Gulf Island says it expects to pay a nominal amount of cash at closing and may, in the alternative, receive cash at closing. The potential transaction is expected to close at the end of the fourth quarter of 2015 or beginning of the first quarter of 2016.
Kirk Meche, President and Chief Executive Officer of Gulf Island, stated: “The acquisition of the LEEVAC assets further diversifies our business, enhances our marine fabrication and maintenance and repair capabilities, and provides our company with facilities in key strategic locations of Lake Charles and Jennings, Louisiana.”