HitecVision’s Reef Subsea goes under

The Norwegian oil & gas specialist investor was reported to have invested NOK 400m in Reef Subsea by the end of 2013, injecting a further NOK 100m the following year.

The company is likely to have been a victim of the steep decline in oil prices since late 2014, with Reef Subsea CEO Duncan Macpherson telling Norwegian newspaper Bergens Tidende that market conditions remained too tough, despite restructuring and cost-cutting efforts deployed by the business.

Reef's British subsidiary, Reef Subsea UK, said on February 10 it was not in administration.

Following the bankruptcy, the total debt in the company and its subsidiaries, as well as claims against it, amounts to more than NOK 1bn.

The debt in three subsidiaries, Technocean Asset, Technocean Subsea Ship Co and Technocean Subsea Operating is reported to total NOK 315m. The debt in Reef Subsea and Technocean Subsea is estimated to be as much as NOK 476m.

A former shareholder in the company, GC Rieber Shipping, is claiming around NOK 190m from HitecVision funds, after the GP bought GC Rieber last year. The shipping company had also let two of its ships to Reef Subsea and says it was due NOK 45m in rental fees.

Preliminary figures show the company had revenues of NOK 1.5bn in 2014, but pre-tax losses of around NOK 14m.

Previous funding
In February 2010, HitecVision acquired Reef Subsea alongside Bergen's GC Rieber Shipping in a NOK 195m management buyout.

Four years later, HitecVision acquired the shares held by GC Rieber Shipping.

The investments were made through the GP's fifth fund, HitecVision V, via the newcos HV V Invest Golf and HV V Invest Golf II.

Company
Founded in 2009, Reef Subsea delivers subsea services to the oil and gas, offshore renewables, power, telecommunications and subsea defence industries.

It has offices in Norway, England and Scotland, and employs around 450 people.

The company offers a range of services, including: subsea construction, inspection, maintenance and repair; installation and trenching of cables and umbilicals; seabed dredging and excavation; and remotely operated vehicles and survey services.

Reef Subsea also provides operators and contractors with personnel, subsea technologies and a fleet of subsea construction support vessels.

People
Tor Espedal is a partner at HitecVision and a member of Reef Subsea's board. Duncan MacPherson is the CEO of Reef Subsea.

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