Hornbeck Offshore Services Inc. (NYSE: HOS) has entered into a definitive agreement to sell substantially all of the assets and business of its Downstream segment's tug and tank barge (TTB) fleet to Genesis Marine LLC, an affiliate of Genesis Energy LP, for a cash consideration of $230 million. Simultaneously with the execution of the definitive agreement, Genesis posted a $23 million deposit.
Hornbeck expects to use the after-tax proceeds from this transaction for general corporate purposes, which may include retirement of debt or funding for the acquisition, construction or retrofit of vessels. The Downstream vessels to be sold to Genesis comprise Hornbeck's active fleet of nine ocean-going tugs and nine double-hulled tank barges.
The transaction is subject to customary closing conditions and regulatory clearances, including the expiration or termination of the waiting period under the Hart-Scott-Rodino Act, and is anticipated to close by the end of the third quarter of 2013. Hornbeck and Genesis also plan to enter into transition service agreements at closing in order to ensure a smooth transition of operations and services for both employees and customers.
J.P. Morgan Securities LLC acted as exclusive financial advisor to Hornbeck Offshore with respect to this transaction.
Hornbeck Offshore is a provider of offshore supply vessels primarily in the US Gulf of Mexico and Latin America, and is also a short-haul transporter of petroleum products through its coastwise fleet of ocean-going tugs and tank barges, primarily in the northeastern US and the US Gulf of Mexico.