Thursday, February 21, 2013

New acquisitions to boost potential of Scomi Marine

By Sharen Kaur
sharen@nstp.com.my
Published in NST on February 21, 2013


KUALA LUMPUR: Scomi Marine Bhd (SMB), which will be renamed Scomi Energy Services Bhd, expects to be in a better position to raise funds for expansion in the oil and gas (O&G) sector as a larger entity.

SMB is buying 76.08 per cent of Scomi Oilfield Ltd for RM776.03 million, 100 per cent of Scomi Sosma Sdn Bhd for RM6.71 million, and 48 per cent of Scomi KMC Sdn Bhd for RM769,911, from its parent Scomi Group Bhd (SGB).

The acquisitions, which will be completed early next month, will be settled in new SMB shares and cash.

SMB will become a larger oil and gas marine and drilling services supplier, with a market capitalisation exceeding RM1 billion.


"With a diversified income stream, SMB will be in a better position to raise funds to tap the potential in drilling services. SGB has many loans and bonds to dispose of. The restructuring will put the entire group in a healthy position," SGB chairman Tan Sri Asmat Kamaludin said.

According to Asmat, with the injection of the three companies into SMB, the group's order book will stand at RM2 billion, keeping it busy for the next three years.

SMB and the three subsidiaries are collectively also bidding for O&G related contracts globally, valued at more than RM3 billion.

It expects to get a handful of the jobs this year.

SGB yesterday obtained the greenlight from shareholders for the disposal of its subsidiaries to SMB as part of its restructuring plan.

The proposed restructuring was mooted by the group's shareholders at the last annual general meeting as it had debts, bonds and a pull option to deal with.

"I think this is the start. We intend to rationalise our operations, especially involving the O&G businesses. I think it will put us in a healthy cash position in terms of gearing," Asmat said after the group's extraordinary general meeting yesterday.

He said post re-structuring, SGB's gearing level will fall to 1.2 times from 2.09 times as at December 31 2011. SGB will also hold 66 per cent stake in SMB from 43 per cent currently. After disposing of the subsidiaries to SMB, SGB will remain as an investment holding company.

Asmat said SGB will continue to look at new investment opportunities outside the O&G and transportation sectors.

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