This article is from the Australian Property Journal archive
Houston-based accommodation provider Civeo has significantly expanded its presence in Australia with the acquisition of four worker housing villages for $105 million.
Civeo has entered the Blackwater region, acquiring four villages in the Bowen Basin, the world’s premier metallurgical coal basin.
The four village comprise 1,340 rooms and were acquired with long-term customer contracts to blue-chip, metallurgical coal producers under take-or-pay contracts.
Civeo CEO and president Bradley Dodson said this acquisition will strengthen the company’s presence in the Bowen Basin, where its existing portfolio has experienced significant occupancy growth over the last few years.
“These villages provide an attractive entry point into the Blackwater region of the Bowen Basin not currently served by our existing villages, supported by contracts with blue-chip metallurgical coal producers with significant investments in this region,” he added.
The Blackwater acquisitions will boost Civeo’s portfolio to 12 properties across Australia, in addition to the eight investments it currently owns, including Boggabri Village, Narrabi Village in New South Wales.
It Queensland Civeo owns the Coppabella Village, Dysart Village, Middlemount Village, Moranbah Village, Karratha Village and Nebo Village.
Globally the company operates 26,000 rooms in Canada and Australia.
The acquisition will be funded with cash on hand and borrowings under the company’s existing credit agreement; and the company has forecast annualised revenue and EBITDA of approximately $50 million and $27 million, respectively.
“Upon closing, we expect the transaction to be immediately accretive to operating cash flow. We have strategically built a capital structure that enables us to allocate capital where we see attractive returns, balancing value-enhancing growth and continuing to return capital to shareholders through our dividend and share repurchase program.” Dodson concluded.
