Photo: Tidewater
One of the world’s largest offshore vessel owners Tidewater has reaped the benefits of consolidation at a time when the market was in a lengthy downturn and remains hungry for more.
In the latest episode of the Seatrade Maritime Podcast Tidewater President & CEO Quintin V. Kneen discussed the company’s acquisition strategy and how he sees future opportunities in an improved market with a higher price environment.
In 2018 GulfMark merged with the much larger Tidewater in a $1.25 billion in all stock deal of the two New York Stock Exchange-listed companies. Kneen, the President & CEO of GulfMark was initially the CFO of the merged entity before taking over as President & CEO of Tidewater.
In the merger of GulfMark Kneen sees that the smaller company brought scaleable systems to the larger Tidewater. While GulfMark was just about a quarter of the size of Tidewater it was as widely spread geographically.
“So, in order to be effective as a small company with a global presence, we had to be very efficient and we had to leverage our computer systems to the highest degree possible,” he explains. “When we merge with Tidewater, that was a real advantage, so we were able to take that scalable technological footprint and bring Tidewater on to that system.”
There was also the asset base in terms of vessels and market presence. “What the GulfMark acquisition brought was a set of high-quality large deck vessels, primarily based out of Aberdeen to the combined fleet. So that was a very important piece of the commercial rationale for the acquisition of GulfMark,” Kneen tells the podcast.
Listen to the full interview on the Seatrade Maritime Podcast
Next up was Swire Pacific Offshore in a $190 million acquisition adding some 50 OSVs when the deal was completed in April 2022. Kneen says that acquisition brought a strong presence in Singapore as well as in Africa and Australia.
The latest deal in 2023 was a fleet of 37 platform supply vessels (PSVs) from Solstad for $580 million which has reinforced the company’s position in the Norwegian market.
One of the features of Tidewater’s M&A strategy was that deals were done towards the end of a lengthy downturn for the offshore vessels sector. Unlike some Kneen had faith the market would rebound, even if he admits he didn’t know when.
Looking at acquisitions today he notes that the market has improved over the last five years and as result those looking to sell their assets today want a better price than they would have earlier.
As a result, he says, “It makes the acquisitions more challenging. Some of the acquisitions that we did earlier, were done at a point in the cycle where I wasn’t as worried about the price we were paying for the acquisition. Nowadays, I want to make sure that the price that we’re paying for vessels is appropriate for the existing value to our shareholders.”
Kneen still sees opportunities in the market but that, “the negotiations are just much tougher”. In terms of where Tidewater is focusing its efforts for further acquisition it is looking to the Americas.
“The acquisitions since 2018 have been primarily focused in Europe, Africa, and Asia. My recent focus has been on areas acquisition opportunities in North America and South America where we haven’t picked up as many assets over the past five years,” he explains.
“Proportionally, we’re probably under-represented in the Americas as a global company and I’m looking for ways to reinforce that position.”
Listen the full podcast episode now in the player above or app of your choice below
