SeaEnergy boss Remp lauds “deal made in heaven”

Steve Remp, boss of marine wind and oil business SeaEnergy (LON:SEA), told Proactive Investors that he expects the proposed deal announced today to dispose of the company’s 80.13 percent interest in its offshore wind farm business SERL to be accepted by shareholders.

“We’re very confident that the shareholders will approve it. This is a deal made in heaven,” said the firm’s executive chairman. “It means we’ve been paid during the past few years to learn everything we can about offshore wind. That’s how I see it.”

The deal between SeaEnergy and Spain’s Repsol Nuevas Energias values SERL, a business which Remp describes as having been created “out of nothing but a concept” three years ago, at £50 million. After transaction costs SeaEnergy will retain net proceeds of £29.1 million, following a repayment in full of loans LC Capital Master Fund and EDP Renováveis of £6.9 million.

Later this morning the firm announced that SeaEnergy Renewables Inch Cape – a subsidiary of SERL – had, in fact, signed a leasing deal with the Crown Estate Commissioners that will lead to the development of around 905 megawatts of offshore wind generation capacity off the Angus coast, east Scotland. Following the conclusion of the deal with Repsol, it is intended that the Inch Cape site will be developed by a JV between Repsol’s New Energy Unit and EDP Renováveis.

Remp says the deal gives SeaEnergy a lot more flexibility. “It allows us to do several things. It allows us to stay in renewable and it allows us to stay in oil and gas. I was always reluctant to leave oil and gas, and now we can stay in this sector.”

SeaEnergy – which changed its name from Ramco in the autumn of 2009 – retains interests in the oil and gas sector through investments in Lansdowne Oil & Gas and Mesopotamia.

On the renewable side of things, the firm has been developing SeaEnergy Marine for the past year. This business is pursuing its plans to construct an operations and maintenance vessel that is aimed specifically at maximising the time that offshore wind farm developers can put technicians onto offshore turbines – so reducing periods when turbines are not producing electricity.

Meanwhile, SeaEnergy Marine is also negotiating a strategic cooperation agreement with Nantong COSCO Ship Steel Structure to explore construction opportunities for steel substructure jackets for use with deepwater offshore wind turbines.

Expertise in building platforms at sea will be much sought after by those constructing offshore wind farms, according to Remp. “Every single oil and gas platform is different, and I have worked on a lot of them. It‘s the same with offshore wind turbines,” he said.

Meanwhile, part of today’s disposal agreement includes a deal between EDP Renováveis and SeaEnergy to explore arrangements for the supply by SeaEnergy Marine of operations and maintenance vessels, field infrastructure and equipment installation vessels for offshore windfarms.

“One of the aspects of this deal is the strategic collaboration between us and EDPR and you will see us duplicate this kind of relationship with a number of major companies,” said Remp.

Indeed, he added: “I’ve never in all my years at Ramco and now SeaEnergy experienced a time when we have so many discussions going on with alliance and joint venture partners.”

In spite of Remp’s upbeat tone, investors were less enthused about the deal. At 2:28pm today the shares were down 41 per cent at 40.6 pence each.

Broker Ambrian Capital’s Gurpreet Gujral wrote in a note released earlier today that “SeaEnergy’s sale of its interests in SERL provides it with the much-needed capital to build out its Marine business, which we believe is likely to generate shareholder value quicker than the offshore wind assets”.