Item 1.01. Entry into a Material Definitive Agreement.
On May 16, 2022, Helix Alliance Decom, LLC, a Delaware limited liability company (“Purchaser”), a wholly owned subsidiary of Helix Energy Solutions Group, Inc., a Minnesota corporation (NYSE: HLX) (“Helix” or the “Company”), Stephen J. Williams, an individual resident of the State of Louisiana (“Seller”), and Helix solely for purposes of Sections 1.05(d) (earn out consideration) and 6.14 (guarantee of Purchaser’s obligation), entered into an Equity Purchase Agreement for the acquisition by Purchaser of all the equity interests of the Alliance group of companies (collectively “Alliance”).
Alliance provides services in support of the upstream and midstream industries in the Gulf of Mexico shelf, including offshore oil field decommissioning and reclamation, project management, engineered solutions, intervention, maintenance, repair, heavy lift and commercial diving services. Among the assets and services to be acquired by Purchaser are Alliance’s comprehensive shallow water assets, including a fleet of Jones Act-compliant lift boats, offshore supply vessels, a heavy lift derrick barge and diving vessels, as well as plug and abandonment systems, coiled tubing systems and snubbing units. The acquisition is expected to expand Helix’s decommissioning presence in the Gulf of Mexico shelf market.
The purchase price is $120 million in cash at closing, plus the potential for post-closing earnout consideration payable in 2024, in the event the Alliance business achieves certain financial metrics in 2022 and 2023. Helix has the option to pay any earn-out consideration in cash, Helix stock, or a combination thereof. The Equity Purchase Agreement contains various cash purchase price adjustments to be calculated as of the closing date and post-closing. Helix expects to fund the cash purchase price due at closing with cash on hand.
The Equity Purchase Agreement contains customary representations and warranties, covenants, indemnification and termination provisions. The acquisition is expected to close in mid-2022 and is subject to regulatory approvals and other customary conditions, such as the expiration of the Hart-Scott-Rodino waiting period. There is no guarantee that the transaction will be consummated on the terms or timeframe currently contemplated, or at all.
Item 7.01. Regulation FD Disclosure.
On May 17, 2022, the Company issued a press release announcing the execution of the Equity Purchase Agreement related to the Alliance acquisition. The press release is furnished herewith as Exhibit 99.1.
The information furnished pursuant to this Item 7.01, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and will not be incorporated by reference into any filing under the Securities Act unless specifically identified therein as being incorporated therein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
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