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7 July 2021
Clarification to InfraStrata's Statement
Triumph Subsea Services notes that InfraStrata plc has posted a response to Triumph’s press release from 1st July 2021.
As per Triumph’s previous press release; for clarity and in respect of the NDA signed between the parties, Triumph will only emphasis points that are already in the public domain and or have actually been declared and posted by InfraStrata on the London Stock Exchange website. However, Triumph will comment on libellous, erroneous and misleading statements that InfraStrata have made in regards to the LoI and Triumph as a company.
An NDA was executed between the parties, wherein Triumph then provided a full corporate overview, company profile and the vessel build bidding package to InfraStrata. The LoI was then executed between the parties, so therefore the numerous inferences that InfraStrata have made in their press release are libellous, erroneous and misleading. InfraStrata’s statement “proven management team, detailed technical specifications with equipment and a detailed design” is completely libellous, misleading and a fabrication of the facts to both Triumph and our industry leading vendors. The fact that Triumph had two global industry leading vendors providing very detailed equipment engineering, specification, documentation and pricing packages along with the vessel design and specifications package; should also be considered in the statements that InfraStrata have made. These vendors along with our naval architects and Triumph itself have placed considerable time, money and resources into the ST269 bidding package. Further to this the considerable time and large capital costs that have been put into the 3D video animations and 3D rendered images showcasing the ST269 clearly demonstrates the levels of engineering in existence to make these videos and images a reality; again a complete contradiction to InfraStrata’s statements.
The LoI consisted of numerous sections inclusive of but not limited to the following:
“Scope of Delivery
Building, outfitting and delivery of the Vessels based on 6 exhibits/documents:
Document 1 – Bidding Package (Exhibit 1 – Instructions to Bidders) 6 pages
Document 2 – Technical Specification (Exhibit 2) 264 pages
Document 3 – Scope of Work (Exhibit 3 – FEED) 3 pages
Document 4 – Scope of Work Skipsteknisk (Exhibit 4) 6 pages
Document 5 – Unit Weight Estimation (Exhibit 5) 1 page
Document 6 – Main Single Line Diagram (Exhibit 6) 1 page
Final description and technical characteristics of the Vessels shall be defined by the Building Specification, General Arrangement and Makers List to be agreed between the Parties and making an integral part of the Contract(s).”
For clarity Triumph has used the same six documents referenced in the above “Scope of Delivery” package for pricing of the ST269 – (FDV variant) vessels in four European tier 1 shipyards (Croatia, Norway, Germany, Spain). All four of these yards had the ability to provide to Triumph a commercially priced quotation and build schedule based on this information with little to no technical queries.
“Budget Prices (indicative)
First Vessel: 340M to 360M GBP
Second optional Vessel: 340M to 360M GBP
Budget Prices are preliminary VROM estimates, based on the early evaluation of the documentation and project requirements provided by the Buyer (hereinafter: the “Budget Prices”), while final prices shall be agreed upon Parties’ agreement on the Building Specification and Makers List and adjusted in line with current hedging exchange rates on the date of the Contract(s) (hereinafter: the “Prices”).”
The above “Budget Prices (Indicative)” clearly stipulates that based on the information InfraStrata had previously received in the form of the “Scope of Delivery” data, then they should have been in a position to provide a commercial proposal and schedule.
Proposed Transaction is subject to the following conditions:
For the Vessels:
- Agreement on Building Specification, General Arrangement and Makers List
- Contracts execution
- Parties Board of Directors’ final approval of Contracts”
It is clear outlined in “Subjects”, that prior to getting to the point of being able to move to “Contracts execution” an agreement needed to be reached on a commercially viable quotation and build schedule.
“Validity and Effectiveness of this Letter
This Letter shall become effective upon the execution by the parties hereof and shall remain in force until 30th June 2021.
This Letter will terminate automatically upon first to occur:
(i) the execution of the Contracts, or
(ii) on 30th June 2021 24:00 UTC if the Contracts will not be executed by that time.
This Letter may be terminated at any time by any party by providing at least fifteen (15) days written notice of termination to the other Party.”
Triumph is cognizant of the fifteen (15) days termination clause, however notwithstanding the fact that Triumph received no formal notification or communication from InfraStrata in relation to this alleged LoI termination. It is noted that in the InfraStrata press release the following statement was made; “Further, Triumph were informed by the Company in April 2021 that the Company had set the LOI aside following due diligence on the credibility of Triumph’s proposal. The Company offered to remain in touch in case there was a material change in the credibility of Triumph’s position in the future.”
This statement is completely contradictory to the statement InfraStrata made at the Investor Roadshow, held virtually on the 12th May 2021. During the event InfraStrata responded to questions from shareholders about the Triumph LoI with the following statements; “The project is complex and we are working with Triumph on the finance and in securing projects for the vessels” and or words to these effects. Ironically it should be noted that the video was originally posted after the Roadshow to the LSE website but then immediately removed. The reason for the videos removal is apparently the video was “corrupted”, however the participants of the Roadshow clearly heard the remarks pertaining to the Triumph LoI as they have been discussing it on LSE chat-board forum following the Roadshow.
Furthermore it should be noted that Triumph did not receive written notification from InfraStrata in regards to the termination; “Further, Triumph were informed by the Company in April 2021 that the Company had set the LOI aside”, although it appears clearly they did not convey this message to any of the shareholders and likewise this may not have been conveyed to any potential investors during the “Placing and Open Offer” that was announced on the LSE website on 4th May 2021. Surely if InfraStrata plc; being a listed company, would have been obligated to have declared this termination to the LSE and the InfraStrata shareholders. Further to this it is noted the InfraStrata LSE release was at 0700hrs UK time on 30th June 2021, considering that termination clause within the LoI was “on 30th June 2021 24:00 UTC if the Contracts will not be executed by that time.”
“Further, Triumph’s aspiration that the UK government would step in and provide the equity was an interesting concept, but we were unable to find any evidence of this being a reality.” This is an extremely interesting statement and again very libellous, erroneous and misleading; as Triumph already had in place letters of offer for export credit finance in relation to our large equipment packages from countries outside of the UK.
In an attempt to assist InfraStrata and H&W in reducing costs, streamlining activities and essentially in becoming a viable entity, whilst benefitting Triumph’s new builds, Triumph arranged and introduced InfraStrata to companies that could be of value to them. These companies either had equipment, technical expertise to assist InfraStrata in becoming a viable and technically advanced shipyard by establishing themselves with the know how to become Shipyard 4.0 and also an offer of technology transfer was offered.
With emphasis on our previous request, Triumph is more than willing to have a discussion with the BOD of InfraStrata and the five main institutional investors. Alternatively, the shareholders of InfraStrata could request an EGM and invite Triumph to attend and discuss the LoI termination.