Posted on: 1 April 2021
Braemar, a leading international shipbroker and provider of expert advice in shipping investment, chartering and risk management, is pleased to announce that it has completed the disposal of its Wavespec business (Wavespec) to Wavespec Holding BV (the Buyer) for a total consideration of £2.635 million (the Disposal). Wavespec was the Group’s Engineering division and its disposal is in line with the Group’s new strategy that is centred on its core Shipbroking business.
Wavespec provides engineering and other expert consultancy services and solutions to the gas processing, liquefied gas, and marine industries. For the year to 29 February 2020, Wavespec generated revenue of £3.1 million and an underlying operating loss of £1.4 million. Wavespec will be treated as a discontinued operation for the year ended 28 February 2021 and the total reported loss is estimated to be around £2.4 million made up of a trading loss of £1.7 million and an estimated loss on disposal of £0.7million. Wavespec’s gross assets, as at the last reported balance sheet date of 31 August 2020 were £0.5 million.
The £2.635 million gross consideration has been satisfied by the issuance of a promissory note with a maturity date of 31 March 2026 (the “Note”), which is currently expected to be retained by the Company. The disposal agreement contains an obligation for the Buyer to secure the Note by providing a standby letter of credit issued by an international bank with an acceptable credit rating. Should they fail to deliver such a letter of credit, Braemar can elect to receive a sum of cash of £0.5 million from the Buyer with the balance of the Note of £2.135 million remaining unsecured. The Board intends to use the consideration from the Disposal to improve the net debt position of the Company. The Disposal is being structured as the sale of 100% of the shares in three separate legal entities from within the Group, Braemar Wavespec Limited, Braemar Wavespec Inc. and Braemar LNG BV. The relevant Wavespec employees, including Wavespec’s Managing Director Sheila McClain, will leave the Group as part of the Disposal.
James Gundy, CEO of Braemar said: ‘The disposal of Wavespec is in line with our stated strategy of refocusing Braemar on its shipbroking core and I am therefore pleased that we have been able to find suitable buyers for Wavespec. We look forward to continuing to work with them under their new ownership and seeing the business thrive.’
Paolo Danesi of Wavespec Holding BV said: ‘We are delighted to have completed this acquisition of Wavespec, whose brand and expertise is very well known and respected as experts in the LNG industry. I am looking forward to working with Sheila and her team to build the business in what is a growing market for their services.’
