Sical Logistics acquires cutter suction dredger for USD 24.92 mn

Sical Logistics Ltd on August 16, 2007 has announced its foray into the dredging market, with the acquisition of Sical PortoFino, a cutter suction dredger, at a consideration of USD 24.92 mn. The acquisition is the latest step in Company's expansion strategy into the global offshore logistics market. The acquisition was funded by Company's foreign currency convertible bonds issue in 2006 and is estimated to earn a revenue of USD 9.8 mn annually.

The Company will deploy its newly acquired dredger in the lucrative Chinese dredging market. The Company plans to acquire more cutter suction and trailer suction hopper dredgers, to serve the needs of the booming Indian and Asian dredging market.

The Company has acquired the newly built dredger through Norsea Offshore Pte Ltd, a wholly owned subsidiary, from a Chinese dredging organization - Shanghai Duo Jun Dredging Co. Ltd (SDJDCL). The dredger was built at the Nan Tong Ganzha Shipyard., China in 2006 and was engaged in a reclamation project in East China Sea since May '06 by SDJDCL.

The dredger is classified as a China Classification Society with a length of 107 m and an average draft of 3.37m. It can dredge upto a depth of 25m and has a production capacity of 3000 cu m per hour. The main pump has enhanced efficiency because of positive pressure from the ladder pump. Its low suction lift enables it to dredge easily even at very great depths. It has a complete spares package sufficient for maintaining high work efficiency. It comes with a 24 m (79-foot) 750 kW (1006-horsepower) anchor handling tender boat.

Comment by the Company's Chairman Ashwin Muthiah: Company's Chairman Ashwin Muthiah said that the acquisition of the cutter suction dredger is a stepping stone for Sical to enter the booming USD 14bn dredging market.

"It is an exciting time for us to enter the lucrative international dredging market. The market has seen tremendous growth due to increasing sea trade, growing tourism opportunities and reconstruction of marine and port infrastructure. With few Companies possessing the required expertise and infrastructure to undertake international dredging operations, the market is facing a supply constraint. The acquisition of the cutter suction dredger will enable Sical to tap the booming opportunity in the dredging market." he said.

Source : Equity Bulls

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