APSEZ acquires 80% stake in Astro Offshore for $185m

Adani Ports & Special Economic Zone Limited (APSEZ), India’s largest ports and logistics company, has entered into a definitive agreement to acquire 80% of Astro in an all-cash transaction for $185m, implying an enterprise value of $235m and an EV/FY25E EBITDA multiple of 4.4x. The transaction is expected to be accretive from the first year onwards.

Founded in 2009, Astro is a leading global OSV operator in the Middle East, India, Far East and Africa. Astro has a fleet of 26 OSVs, including anchor handling tugs (AHTs), flat-top barges, multi-purpose support vessels (MPSVs) and workboats, and provides vessel management and complementary services. Astro has revenues of $95m and EBITDA of $41m for the year ending April 30, 2024. Astro is net cash positive as of April 30, 2024.

Astro has an impressive roster of Tier 1 customers, including NMDC, McDermott, COOEC, Larsen & Toubro and Saipem. Astro is a key player in the offshore construction and fabrication, and offshore transportation markets. Astro has prequalification with major global EPC contractors and the ability to deliver a wide range of ocean-going vessels, which has enabled it to build a roster of Tier 1 customers in the oil and gas industry.

Astro has extensive experience in supporting the construction and maintenance of offshore platforms, oil and gas fields and subsea facilities, which has enabled it to provide cutting-edge services to customers in the offshore exploration and drilling markets.

Astro's vessels also support a number of operations for leading international dredging companies, including large offshore construction and land reclamation projects. Astro leverages an effective mix of mid- to long-term contracts with its customers, enabling it to maintain high fleet utilization and benefit from improved charter rates while the global OSV fleet is in limited supply.

Ashwani Gupta, Whole Time Director and CEO of APSEZ, said: "Astro's acquisition is part of our roadmap to become one of the largest marine operators in the world. Astro will add 26 OSVs to our current fleet of 142 tugs and dredgers, bringing the total to 168. The acquisition will also give us access to an impressive list of Tier 1 clients while further strengthening our footprint in the Arabian Gulf, Indian Subcontinent and Far East Asia. We look forward to working closely with Astro's leadership team to expand the existing platform."

Mark Humphreys, Managing Director of Astro Offshore, said: "Over the past 15 years, we have created an impressive company growth trajectory, driven by our strategic investments in our OSV fleet and deep relationships with our customers. The partnership with APSEZ is a key inflection point for us. By working together, we can accelerate growth, further expand the size and diversity of our fleet, extend our geographic reach and provide more end-to-end solutions to our customers."

The transaction does not require regulatory approvals and is expected to close within a month, subject to the satisfaction of operational preconditions.