TechnipFMC Strikes G1201 Sale Deal
- Business & Finance
TechnipFMC has entered into memorandum of agreement (MOA) to sell the G1201 subsea vessel as it aims to optimize the profile and size of its subsea fleet.
The MOA is subject to certain conditions precedent to complete the transaction.
TechnipFMC expects to complete the sale in December as these conditions are met, including delivery of the vessel in December 2019.
The MOA also includes a collaboration agreement with the buyer that would provide 5 years of exclusivity for a list of named subsea projects in a specific jurisdiction and the right of first refusal for other projects not specifically named in the collaboration agreement.
Due to this MOA, the company also reviewed the carrying value of the G1200 vessel, the sister vessel to the G1201, of similar design, asset class and functionality.
As a result of the proposed sales price of the G1201 and its current book value and the book value of the G1200, its sister vessel, the company has recorded a non-cash asset impairment charge.
The total non-cash charge was $125 million for both vessels and was recorded in the third quarter of 2019.