(Reuters) – Norwegian supply shipping company DOF Group on Tuesday agreed with Maersk Supply Service Holding (MSSH) to buy offshore shipping services provider Maersk Supply Service (MSS) for $1.11 billion in a cash and stock deal, the company said.
Under the deal, DOF will pay $577 million in cash and issue new shares. MSSH, a subsidiary of AP Moeller Holding, will own 25 percent of DOF shares following the transaction, the statement said.
DOF added that it would handle the deal through a new subsidiary, DOF Offshore Holding Denmark ApS.
The merged company will operate under the name DOF and will be listed on the Oslo Stock Exchange, the statement said. The transaction is expected to close in the fourth quarter of this year.
DOF said it intends to finance the deal through a $500 million credit line and will raise up to $125 million in equity. The transaction does not include MSS’s operations in Brazil, it added.
“The transaction announced today represents a strategic milestone for the DOF Group and is based on a strong industry focus and a shared vision with AP Moller Holding, which indirectly becomes a major shareholder,” said Mons Aase, CEO of DOF.
Maersk has agreed to sell Maersk Supply Service to family-owned AP Moller Holding for $685 million in 2023.
(Reporting by Gursimran Kaur and Devika Nair in Bengaluru; Editing by David Evans and Jan Harvey)
