Boskalis Receives $2.5B Buyout Offer from its Largest Shareholder

buyout offer for Boskalis
Boskalis operates dredging as well as supporting offshore energy and operations in marine salvage (Boskalis)

Published Mar 10, 2022 6:15 PM by The Maritime Executive

Saying that it sees little value in being a public company, the largest shareholder of dredging and marine services company Boskalis announced it plans to make an all-cash offer to take the company private. The unsolicited offer valued at $2.5 billion from HAL Holding came as Boskalis announced strong financial results for 2021 and outlined a positive outlook for the company.

Founded more than 100 years ago, Boskalis traditionally was a dredging company involved in hydraulic engineering, coastal protection, and land reclamation. The company has expanded to a broad range of maritime services with a fleet of more than 700 vessels and floating equipment. In addition to its historical services, which today include the construction and maintenance of ports and waterways, land reclamation, coastal defense, and riverbank protection, the company offers services in the offshore energy sector. These include the development, construction, transport, installation, inspection, repair, maintenance and decommissioning of oil and LNG import/export facilities, offshore platforms, pipelines and cables, and offshore wind farms. Boskalis is also the parent company of the emergency service, towing, and salvage company SMIT.

“It is HAL’s assessment that the current public listing offers limited added value to Boskalis, and does not outweigh the costs and other disadvantages of the listing,” the investment company writes noting that they have been an investor since 1989 currently holding just over 46 percent of the stock. “HAL believes that given Boskalis’ business characteristics, the long-term nature of its larger projects (typically spanning multiple years), and the cyclicality of its underlying markets, Boskalis could benefit from private ownership with a long-term investment horizon, and that such private ownership could also enhance M&A opportunities.”

Pending approval of the offer memorandum by the Dutch Authority for the Financial Markets, HAL said it will commence an offering at a 28 percent premium to the recent stock price of Boskalis. The offer, which is not subject to a minimum acceptance level, values Boskalis at €4.2 billion (approximately $4.6 billion).

HAL is an investment company that emerged as the successor to Holland America Line after the passenger shipping company was sold to Carnival Corporation in 1989. In making the offer, HAL stressed that it supports the existing strategy of the company and has no intention to change management or strategy. However, it believes that long-term value would be best served as a private company.

The offer came as Boskalis reported strong financial results for 2021. “Boskalis is in good shape as a company,” they reported to shareholders, saying, “with its well-filled order book and strong financial position. The market looks favorable for the medium term as well as for the short term, although the consequences of the recent geopolitical events in Eastern Europe are still difficult to assess.” They reported that the macro trends, including population growth and urbanization, that drive the business would have a positive impact in the medium to long-term 

They reported a 17.5 percent increase in revenues to just under €3 with a 55 percent increase in net profit. To support what it sees as an undervalued share price, management announced a €100 share buyback program. The board of directors acknowledged the receipt of the offer from HAL saying it will carefully consider all aspects of the proposed offer in accordance with its fiduciary duties.