STX OSV

STX OSV: Announced it has secured a contract for the design and construction of one Cable Laying Vessel (CLV) for an international client.The vessel will be of STX OSV’s own CLV 01 design. Delivery is scheduled in 3Q14. The hull of the vessel will be delivered from STX OSV Tulcea in Romania. The contract price exceeds NOK 450m. We note that grp’s orderbook now stands at approx. Nok 18.5b and ytd grp has secured Nok7.8b. Orderbook underpins visibility till 2015. Separately we note that substantial shareholder, PE Fund Och-Ziff has pared down their stakes from 19% to 14% through a series of transactions, although there is no news yet on who was the buyer. DMG add that while the sale by Och-Ziff is likely to be taken negatively by the market, share price has held up well. Estiamte sale by Och-Ziff could be a case of taking profit on the stock as the stock has returned 45-50% from its entry price. (Estimate Och-Ziff’s entry price at around $1.05/share, after adjusting for three dividend payout of $0.28) Ratings as follows: DMG maintains Buy with $2.20 TP OCBC maintains buy with $2.00 TP.