Prosafe and Floatel agree extension of share purchase agreement amid competition concerns
Offshore accommodation giants Prosafe and Floatel International have agreed an extension of a share purchase agreement related to a proposed merger of the two companies amid concerns raised by competition authorities in the UK and Norway.
According to Prosafe’s statement on Thursday, Prosafe and Floatel International have agreed to extend the long stop date in the share purchase agreement from December 31, 2019, until June 30, 2020.
Competition clearance continues in Norway and the UK, and further information will be provided in due course, Prosafe said in the statement.
A potential merger will also be subject to lenders approval, approval from Floatel bond holders, and approval by an extraordinary general meeting in Prosafe.
The merger between the two accommodation giants has raised concerns with competition authorities both in the UK and Norway. If realized, the proposed merger would create the world’s largest offshore accommodation company, with Prosafe currently owning and operating a total of nine offshore accommodation units, and has options for delivery of two newbuilds, while Floatel’s fleet counts five units.
In October 2019, the Norwegian competition authorities rejected the proposed merger between Prosafe and Flotel saying that the merger would lead to increased prices for customers of offshore accommodation services. Prosafe then in November last year appealed the Norwegian Competition Authority’s decision to reject the merger.
In the UK, the process with the Competition and Markets Authority is in Phase 2 and more specific information is anticipated to be available during the first quarter of 2020.
Offshore Energy Today Staff
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