Hengtong Optic-Electric to acquire Huawei Marine Networks
Hengtong Optic-Electric has agreed to purchase Global Marine Group’s (a HC2 Holdings company) 49 per cent stake in Huawei Marine Networks in a transaction valued at approximately $140 million.
Under the agreement, Global Marine Group will sell 30 per cent of its interest to Hengtong at closing, retaining a 19 per cent interest under a two-year put option agreement at the greater of the same equity ($285mm) or fair market value.
Hengtong will also buy Huawei’s full 51 per cent stake and will own 81 per cent of the joint venture upon the closing of both sales. It will reach 100 per cent upon the exercise of GMG’s put option.
Philip Falcone, chairman, president and chief executive officer of HC2 said of the announcement: ‘We are very pleased at the outcome of the joint venture sales process. 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 Global Marine Group, including the main operating subsidiary, Global Marine Systems, which continues to be a top priority for us as we close out 2019.’
Completion of the sale is expected during the first quarter of 2020, subject to customary closing conditions.