In a significant business transaction, ExxonMobil (NYSE:XOM) Guyana Limited has acquired the Floating Production Storage and Offloading (FPSO) vessel Liza Unity from SBM Offshore, a leader in the offshore energy industry. The deal is valued at approximately $1.26 billion.
The acquisition has been complted ahead of the end of the lease term in February 2024. Despite the change in ownership, SBM Offshore will continue to manage and maintain the unit until 2033 as per the integrated operations model agreed upon by both parties.
The proceeds from this transaction will be used to repay the $1.14 billion project financing, thereby executing SBM Offshore's debt reduction strategy. This move also aligns with SBM Offshore's commitment to the energy transition within the offshore energy industry, as they continue to focus on providing renewable energy solutions and reducing fossil fuel emissions.
As part of its ongoing operations, SBM Offshore has outlined key dates in its financial calendar. These include Full Year 2023 Earnings on February 29, 2024; Annual General Meeting on April 12, 2024; First Quarter 2024 Trading Update on May 8, 2024; Half Year 2024 Earnings on August 8, 2024; and Third Quarter 2024 Trading Update on November 14, 2024.
InvestingPro Insights
In light of the recent business deal between ExxonMobil Guyana Limited and SBM Offshore, it's worth considering some key insights provided by InvestingPro.
For ExxonMobil, a prominent player in the Oil, Gas & Consumable Fuels industry, this transaction could further strengthen its financial stability. The company has a history of maintaining dividend payments for over five decades, and its cash flows have been reported to sufficiently cover interest payments. This is a testament to its robust financial health. It's also worth noting that ExxonMobil's stock generally trades with low price volatility, offering a level of predictability for investors.
On the other hand, SBM Offshore operates with a significant debt burden. The proceeds from this transaction will be used to repay the $1.14 billion project financing, aligning with their debt reduction strategy. Despite the company's financial challenges, it has maintained its dividend payments for 8 consecutive years, which may be of interest to income-focused investors.
These insights are based on the InvestingPro Tips, which offer a comprehensive analysis of both companies. For a more in-depth look into these and other companies, consider exploring the additional tips available on InvestingPro.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.