Shallow-water driller Hercules Offshore (NASDAQ: HERO ) has signed a definitive agreement to acquire the liftboat Titan 2, a 280-foot class vessel built in 2008, from a subsidiary of KS Energy for $42 million in cash. It expects the acquisition of the Panamanian registered and flagged vessel to close early next month.
With the Titan 2 currently located in Limbe, Cameroon, Hercules is looking to capitalize on strong demand for larger vessel classes in West Africa. The driller's president and CEO John T. Rynd was quoted as saying, "Our acquisition of the Titan 2 expands our opportunity set in the region to meet the most attractive segment of this market, and is part of our ongoing effort to renew our fleet. The Titan 2 is one of the premier liftboats in the region, with a solid record of operations for some of the most prominent customers in West Africa."
The acquisition adds to Hercules' existing fleet of 37 jackup rigs, 13 barge rigs, and 63 liftboats. Following the closing of the transaction, Hercules expects the vessel to commence work at a dayrate of approximately $65,000. Afterward, the Titan 2 will be scheduled to enter the shipyard for approximately one month for dry-dock maintenance and certain capital upgrades estimated at approximately $5 million.
The driller indicated it is in discussions on several additional opportunities in the region.