Acteon Group, a global subsea services company, is buying Actuant’s Viking SeaTech business, and Actuant is buying Acteon’s Mirage, a provider of industrial and energy maintenance tools.
Viking SeaTech provides marine engineering and consultancy for surveys, assurance, inspection, and audits, and specializes in mooring equipment for offshore installation and recovery as well as rig positioning.
Acteon is buying Viking at a steeply discounted price of $12 million compared to the $225 million that Actuant, headquartered in Milwaukee, Wisconsin, paid in 2013 to acquire the company. Acteon is selling Mirage to Actuant for $16 million.
Randy Baker, Actuant president and CEO, said, “The decision to divest Viking was not taken lightly, but it is consistent with our strategy to concentrate our energy offerings where we can provide the most value over the long term. It also helps to simplify and stabilize our portfolio by significantly limiting exposure to upstream, offshore oil and gas.”
Actuant is the parent company of Hydratight, a provider of joint integrity solutions and subsea connectors, tensioners, and pipeline repair systems. Baker said the Mirage business is complementary and broadens the company’s product line offerings, especially in flange facing and hot tapping.
In his 3Q earning call, Baker said the “disappointing EPS [earnings per share] in the quarter of only $0.32 a share” was driven by the “impact of our energy business.” Hydratight’s business was affected by the increased delays in project scope and start dates. The degree of reductions “has been a new dynamic; not only have companies reduced the amount of work, but they’ve also reduced the amount of rental and service we’re doing on these job sites,” he said. “We see a replacement in nondestructive testing and replacing service intervals, and the dynamics of all three of these factors have created a very difficult environment for our Hydratight team.
Baker added that Hydratight remains a core business for the company and remains profitable.
Earnings were also decreased in the quarter because of the losses of Actuant’s upstream exploration and offshore well development businesses, which Baker described as having “accelerated during the year and have continued.”
The company is exploring options to limit its exposure to exploration and well development, Baker said, adding, “I can’t give you a lot of details into that.” He said additional updates would be provided as the quarter progressed.
The sale of Viking looks like a move in Actuant’s restructuring strategy.
In June, Baker said the company is restructuring its energy segment to save between $3 million and $4 million with an associated cost of $2 million. “The timing has started now in our fourth quarter and will continue into Q1 of 2018, but rest assured, we are going to take every action early as possible to get the full cost benefit for the future earnings.”