– Sale pegs HMN equity value at $285 million –
– Global Marine Group’s 49% interest valued at $140 million –
– HC2 continues to advance strategic alternatives for Global Marine subsidiary –NEW YORK, Oct. 30, 2019 (GLOBE NEWSWIRE) — HC2 Holdings, Inc. (“HC2” or the “Company”) (NYSE: HCHC), a diversified holding company, announced today that its Marine Services Segment, Global Marine Group (“GMG”), a leading provider of offshore engineering services to the telecommunications, oil & gas, and renewables industries, has agreed to a sale of its stake in Huawei Marine Networks Co., Limited (“HMN”), its 49% joint venture with Huawei Technologies Co., Ltd. (“Huawei”), to Hengtong Optic-Electric Co Ltd (“Hengtong”). The sale of GMG’s interest values HMN at $285 million, and GMG’s 49% stake at approximately $140 million. Under the agreement, GMG will sell 30% of HMN to Hengtong at closing and retain a 19% interest in HMN under a two-year put option agreement at the greater of the same equity value ($285mm) or fair market value. Hengtong is also purchasing Huawei’s full 51% stake and will own 81% of the joint venture upon the closing of both sales, and 100% upon the exercise of GMG’s put option. Completion of the sale is expected during the first quarter of 2020, subject to customary closing conditions, with proceeds delivered to GMG at that time. After satisfaction of any pending obligations and in concert with any sale of Global Marine Systems Limited (“GMSL”), HC2’s share of the net proceeds from the HMN sale will be utilized to reduce debt at the HC2 holding company level. “We are very pleased at the outcome of the joint venture sales process,” said Philip Falcone, Chairman, President and Chief Executive Officer of HC2. “We want to thank our partners at Huawei, with whom we have had a great working relationship since our acquisition of GMG five years ago, for successfully growing the joint venture and completing over 98 projects globally since inception. Inking this deal now further sets the stage for a potential sale of GMG, including the main operating subsidiary, Global Marine Systems Limited, which continues to be a top priority for us as we close out 2019.”About HC2HC2 Holdings, Inc. is a publicly traded (NYSE:HCHC) diversified holding company, which seeks opportunities to acquire and grow businesses that can generate long-term sustainable free cash flow and attractive returns in order to maximize value for all stakeholders. HC2 has a diverse array of operating subsidiaries across eight reportable segments, including Construction, Marine Services, Energy, Telecommunications, Life Sciences, Broadcasting, Insurance and Other. HC2’s largest operating subsidiaries include DBM Global Inc., a family of companies providing fully integrated structural and steel construction services, and Global Marine Systems Limited, a leading provider of engineering and underwater services on submarine cables. Founded in 1994, HC2 is headquartered in New York, New York. Learn more about HC2 and its portfolio companies at www.hc2.com.About the Marine Services Segment and Global Marine Group
The Marine Services Segment operates under the platform Global Marine Group (“GMG”), which includes Global Marine Systems Limited (“GMSL”), an operating subsidiary of HC2 Holdings Inc. (NYSE: HCHC). GMG is a market leader in offshore engineering and is recognized as a high quality, independent strategic partner across multiple sectors. GMG consists of three business units; Global Marine, providing fibre optic cable solutions to the telecommunications and oil & gas markets, CWind, delivering power cable and asset management services topside and subsea, to the offshore renewables and utilities markets, and Global Offshore, delivering the Company’s trenching and power cable laying capabilities within the oil & gas sector.GMG has three successful joint ventures, including two in China, SBSS and HMN, demonstrating the true global reach of the Company. Additionally, CWind Taiwan was formed in 2018 addressing the needs of the fast-growing offshore renewable sector in Asia. The combined experience and knowledge has led to significant embedded intellectual property and an enviable track record.GMG has an outstanding record in health & safety and proudly hold the RoSPA Order of Distinction, following 19 consecutive years’ of receiving their Gold Standard in recognition of outstanding occupational health & safety standards.GMG is in a unique position, owning the world’s largest independent marine contracting fleet including two specialist cable installation and repair vessels, four maintenance vessels and 19 owned CTVs. Additionally, the company has a diverse range of subsea equipment including eight trenchers and working class ROVs.GMG boasts a number of industry achievements, from installing the first subsea cable in 1850, being part of the consortium that invented the universal joint, and right through to today, finding solutions for client challenges such as low carbon crew transfer vessels for offshore wind farms.GMG aspires to achieve its vision ‘Engineering a clean and connected future’.For more information about GMG, GMSL, CWind and Global Offshore, please visit our websites at www.globalmarine.group, www.globalmarine.co.uk, www.cwind.global and www.globaloffshore.co.uk.
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