Pacific Basin had signalled last October that it was sounding out the market to establish whether there was interest in a third party acquiring the towage business comprising its harbour towage, and offshore towage and infrastructure support businesses (PB Sea-Tow).
The price will be calculated based on the tangible net asset value of the harbour towage business as at a completion accounts date to be mutually agreed upon by the company and the bidder, Pacific Basin said in a stock market announcement. It however warned that discussions are at a preliminary stage and there is "no certainty" that the company will proceed with the deal.
Pacific Basin entered the towage sector in 2007 with the purchase of an Australian harbour towage business. It has full harbour towage services in the ports of Melbourne, Brisbane, Port Botany, Townsville and Onslow and in a number of bulk ports in Western Australia and recently, in the second half of last year, started up operations in the major coal port of Newcastle, where it is one of only two operators. As recently as its 2013 full-year results briefing Pacific Basin had said that Newcastle represents the next phase of growth for its harbour towage business.
PB Towage operates a fleet of 45 vessels in the Oceania, Southeast Asia and Middle East regions, offering a range of marine logistics and towage services. The recent results showed however that this division is lagging somewhat as projects offshore Australia wind down and new contracts need to be found. The towage division saw net profit plunge to $10.5m this year from $37.7m in 2012. Return on net assets was just 5% compared to 17% previously, reflecting lower profitability.
It also announced that the board has decided to discontinue the sounding out of the market to establish whether there is third party interest in acquiring PB Sea-Tow.
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