Wed, 01 Sep 2021 | BUSINESS SALE
Defence and engineering firm Babcock International Group has sold its oil and gas aviation division to helicopter specialist CHC Group LLC in a £10 million deal. The sale forms part of Babcock’s targeted disposal programme, through which the group is aiming to raise at least £400 million in sales to reduce its net debt.
In the year to March 31 2021, the division reported a pre-tax loss of £2 million and underlying profit of £2 million on revenue of £154 million. At the time, the firm’s gross assets were valued at £256 million. In Babcock Group’s most recent annual results, reported in July, it posted an operating loss of £1.64 billion with net debt standing at £1.4 billion.
Babcock’s oil and gas aviation division provides transportation services for offshore oil and gas crews working in the UK, Australia and Denmark. The business is based in Aberdeen, operating a fleet of approximately 30 aircraft at its three locations and employing over 500 staff.
The sale comes in the wake of Babcock’s £293 million divestment of the Frazer-Nash Consultancy to American firm KBR. The company, which operated in Babcock’s marine division, had been part of the group for 14 years, providing services including submarine design.
The sale of its oil and gas aviation business was described by Babcock CEO David Lockwood as part of the group’s strategy to “streamline and focus” on its key markets.
Lockwood added: “Divesting at least £400m of businesses will enable us to reduce complexity and increase our focus as we return Babcock to strength. The oil and gas aviation business has found a new home and we wish them all the best for the future."
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