WELLARD Limited has told the Australian Stock Exchange this morning it is actively negotiating the sale of its ship, the M/V Ocean Swagman, with another potential buyer, after the previously announced buyer, Heytesbury Holding Company Pty Ltd, did not complete due dilligence by an agreed deadline.
On July 4 Wellard announced Heytesbury would purchase the M/V Ocean Swagman for US$22 million, and Wellard would charter the vessel back from Heytesbury for an initial period to 31 March 2021, with options to extend for up to four years.
Heytesbury is a major shareholder of Wellard Limted, holding 11.42 percent of Wellard stock.
However, it now appears the previously announced deal may not proceed.
In an update to the ASX this morning Wellard said it is actively negotiating with another party in relation to an alternative transaction in respect of the M/V Ocean Swagman “that could lead to a superior proposal to the Heytesbury transaction”.
Wellard said the terms of the alternative transaction had not yet been finalised, and there was no certainty any alternative transaction will proceed.
Wellard said it had been informed by Heytesbury that its technical due diligence conducted on the M/V Ocean Swagman was complete and was satisfactory, but Heytesbury had “not yet completed its due diligence on the transaction generally”.
“The 4 July 2019 Term Sheet had a deadline of 29 July 2019 for Heytesbury to formally notify that it has completed its due diligence, which notice has not been given,” this morning’s Wellard statement said.
“Heytesbury has requested an extension of time for the delivery of its formal due diligence completion notice, and has also proposed some amendments to the terms of the transaction.
“Wellard’s Board is considering all of Heytesbury’s requests and will update the market as appropriate.”
Heytesbury has been contacted for comment.