SINGAPORE - Sembcorp Marine (SembMarine) said on Friday (June 8) it plans to spend US$28 million (S$37.4 million) that would go towards acquiring the intellectual property of Norway's Sevan Marine, bringing to an end a "long-standing" dispute over infringement of each other's intellectual property.
The deal will also translate to SembMarine purchasing a 95 per cent equity interest in HiLoad LNG, a Sevan Marine subsidiary which holds certain intellectual property rights, the transfer of 26 Sevan Marine employees, as well as unexpired leases of the company's three office locations.
The deal, done through its wholly owned unit Sembcorp Marine Integrated Yard, means as well that SembMarine would undertake to take over some of Sevan Marine's existing service contracts and provide engineering services to some of Sevan's existing contract partners which have outstanding licence fees payable to Sevan Marine.
"The litigation between SCM Group and Sevan Marine in the US courts over the infringement of intellectual property rights of SCM Group will be terminated subject to completion," SembMarine said in a regulatory filing.
Sevan Marine, which is listed on the Oslo Bourse, specialises in the design, engineering and project execution of floating units for offshore applications. Their main product is a cylindrical platform used for floating production and drilling.
"Through the strategic acquisition of Sevan Marine's intellectual property rights, the long-standing dispute over infringement of each other's IP can be resolved," SembMarine said.
"Sembcorp Marine will be well placed with a suite of intellectual properties and knowledge to execute leading-edge design and engineering solutions for the global offshore and marine sectors. This puts the company in a better position to offer alternative solutions to customers and partners."
The asset sale must be approved by the shareholders of Sevan Marine and certain third parties by Dec 31, 2018.
If Sevan Marine receives a binding offer from another party for the proposed transaction for a cash price that is at least 10 per cent higher, SembMarine shall have the right, but not an obligation, to match such an offer. Should the asset sale be terminated by Sevan Marine due to an offer from elsewhere, it will reimburse SembMarine "reasonable transaction costs". Litigation between the SembMarine and Sevan Marine in the US courts over the infringement of SembMarine's intellectual property rights will then continue, SembMarine said.