Great Lakes Dredge & Dock Corporation (NASDAQ: GLDD) announced on October 22 that it had signed a definitive agreement to purchase two dredges from Dragaport Ltda.
They are the 5600-cubic-meter hopper dredges Macapa and Boa Vista 1.
Dragaport is a Brazilian engineering and civil construction company that specializes in dredging.
The terms of the agreement with Dragaport provide for Great Lakes Dredge & Dock Company LLC a subsidiary of Great Lakes Dredge & Dock Corporation to purchase the dredges for the combined price of $25 million.
The dredges are flagged and located in Brazil and Great Lakes plans to re-flag them under Marshall Island law and deploy them to the Middle East to begin working on projects in backlog.
The purchase will be financed with cash on hand and borrowings under the company’s senior credit facility by the end of 2007.
Douglas B. Mackie president and Chief Executive Officer said “during the past several years we have been increasingly successful in being awarded projects in the Middle East. The acquisition of these two dredges will increase our hopper capabilities improving our operating efficiencies on current projects and enabling the company to negotiate more competitively on upcoming projects. Having identified the Middle East as market with significant growth potential the ability to increase our footprint in the region and add capacity further strengthens the company’s competitive position in this geographic area.”