Reef Subsea

Apr 28, 2015

+1 Pic: X-Subsea UK Aberdeen-based subsea dredging and excavation firm X-Subsea UK Holdings Ltd has gone into administration with the loss of 20 jobs. Joint administrators Iain Fraser and Tom MacLennan of FRP Advisory have also been appointed to its UK-based subsidiaries, X-Subsea UK Ltd and X-Subsea Atlantic Ltd. The company said 20 of its 26 Aberdeen-based staff have been made redundant with immediate effect and six employees based overseas have been retained to complete the company's only ongoing contract. The administrators note with only one contract in place, “and a lack of funding it was not viable to trade the business in the short term”. X-Subsea’s parent company, Norwegian based Reef Subsea AS, was placed in Norwegian insolvency proceedings in early February. The collapse of Reef Subsea AS also pushed Aberdeen-based Specialist Subsea Services Ltd (S3) into administration with the loss of 77 jobs. X-Subsea, like S3 in which it held an 80 per cent stake, has historically been reliant on support from its parent company Reef Subsea AS. The withdrawal of support, “combined with a downturn in work and consequent financial constraints have resulted in administration being the only option, the administrators said. X-Subsea designs and builds a range of patented tools which can operate to depths of up to 2500 metres. The specialised equipment can generate a flow of up to 8 tons of water per second and its non-contact excavation techniques prevent damage to pipelines, cables, sub-sea structures and the environment. The joint administrators will now seek a buyer for the businesses and assets. The X-Subsea UK companies' subsidiary operations in the USA (Houston), Mexico and Singapore are not in administration. Iain Fraser of FRP Advisory, said: “X-Subsea is the market leader in the design and supply of highly sophisticated excavation and dredging equipment. “The business has been badly affected by the current downturn in the oil and gas sector, and despite restructuring of the group earlier this year, income and cash flow has fallen substantially, with administration of the UK businesses being the only option. “X-Subsea has a blue chip client base and interests in valuable intellectual property assets. “We will now market the businesses and assets for sale, and would urge interested parties to contact us as soon as possible.”