Norwegian seismic service provider Electromagnetic Geoservices (EMGS) has expanded its business into the offshore construction sector with the acquisition of the Siem Day offshore subsea construction vessel (OSCV).
EMGS said that the acquisition represents a strategic diversification, complementing its existing electromagnetic operations and expanding into the growing subsea construction segment.
The vessel was built in 2013 by Vard. The OSCV was bought from a wholly-owned subsidiary of Siem Offshore, Siem Day II AS. Under the transaction, EMGS will enter into a five-year bareboat charter agreement with Siem at a rate of $42,000 per day until December 31, 2025, increasing to $45,000 per day thereafter.
The charter includes purchase options exercisable at the third and fourth anniversaries of the charter commencement, as well as an unconditional purchase obligation at the end of the charter period.
The total acquisition price of $108.90m is structured to minimise upfront cash outlay, with an initial payment of only $10.89m due at charter commencement.
Following the expiry of the current charter on December 31, 2025, EMGS plans to operate the vessel on term contracts. Spot charter rates are currently estimated to range between $100,000 and $140,000 per day.
The long-term strategy for EMGS is to pursue growth in the subsea sector through the addition of further vessels by acquiring a high-quality asset already under contract and with opportunities in a dynamic subsea market beyond 2025.
To ensure efficient operations without increasing the company’s fixed cost base, EMGS intends to engage the vessel’s current manager, Aurora Offshore, for technical and commercial ship management. Siem Offshore owns and controls 40% of the share capital of Aurora Offshore.
