Sapura Energy sells entire 50% stake in SapuraOMV to TotalEnergies for USD 705 million

KUALA LUMPUR (April 22): Sapura Energy Bhd has acquired the remaining 50% stake in SapuraOMV Upstream Sdn Bhd, the exploration and production (E&P) unit it acquired in 2014, to TotalEnergies Holdings SAS for US$705.3 million (33 The company will sell the company for RM70 million. — Consists of US$530.3 million in cash and US$175 million in debt forgiveness.

Sapura Energy acquired the E&P division from Newfield Exploration in 2014 for US$898 million, before selling half of its stake to OMV AG in 2018 for up to US$975 million.

The price of the remaining 50% stake is USD 198 million lower than the USD 903 million that TotalEnergies is paying to acquire the remaining 50% stake from OMV. The sale will give the French oil major full ownership of SapuraOMV. It was previously reported that Sapura Energy was seeking US$1.2 billion for the stake.

Sapura Energy said in a statement that the US$175 million debt was acquired by a division of OMV AG “in connection with a share underwriting and restructuring exercise” that took place in January between Sapura Energy, OMV and SapuraOMV. He stated that this was related to the loan facility provided to SapuraOMV. 31st, 2019.

The proposed sale will result in a net sale gain of approximately RM793 million upon completion, Sapura Energy added.

The company expects the sale to close “at the latest” in the second half of 2025, with both parties “committed to expediting the transaction to close by the end of 2024.”

Group chief executive officer Datuk Mohd Anuar Taib said the price secured by the company was “fair and equitable”.

“This portfolio rationalization marks a strategic shift away from our E&P business as we strengthen our core competencies to deliver innovative solutions to the dynamic energy industry,” he said. Ta.

Even after the exit from E&P, Sapura Energy still has a backlog of RM6.6 billion from other sectors such as engineering and construction, drilling, and operations and maintenance, the company added.

Sapura Energy is facing mixed signals, including geopolitical tensions in the Middle East, where oil prices are putting supply at risk, while the demand side is clouded by concerns about a global economic slowdown. Withdraw from business.

Upstream services company E&P’s ambitions were driven by former CEO and president Tan Sri Sharil Shamsuddin and culminated in the acquisition of the upstream business in 2014.

SapuraOMV’s assets include a working interest in the SK408 (40%) and SK310 (30%) offshore Sarawak, both of which are expected to continue operating on an annual basis for the financial year ending 31 January 2023 (2023). It produced an average of 30,000 barrels of oil equivalent per day during the year. Report numbers.

Sapra Energy said in a statement that the Jelun gas field within SK408 is on track to become operational in late 2024.

“SapuraOMV also holds exploration licenses across strategic regions including Malaysia, Australia, New Zealand and Mexico,” it added.

The cash component of US$530.3 million and debt forgiveness of US$175 million provide temporary relief to Sapura Energy as it develops a regularization plan to address its Practice Note 17 status.

As at the end of January, Sapura Energy had RM10.98 billion in debt, RM5.5 billion in accounts payable and cash of RM1.45 billion.

The cumulative loss amounted to RM17.31 billion, and the shareholder deficit amounted to RM4.19 billion, up from RM2.9 billion in the same period last year.

The group is in the process of developing a normalization plan to address its balance sheet position. The court has ordered a stay until June 10 from legal action by creditors, including local vendors and creditors of the company’s RM10.3 billion multi-currency loan facility.

As of December last year, at least 75% of these creditors have given the necessary in-principle approval to the company’s proposed debt restructuring plan.

Sapura Energy’s shareholders include Permodalan Nasional Bhd (40.73%) via Amanah Saham Nasional Bhd. Brothers His Capital Sdn Bhd is related to Mr Shahril and his brother Datuk Shahriman Shamsuddin and owns his 12.94% indirect stake in the listed company. Mr. Sharir also directly owns 1.09% of Sapura Energy.

Besides SapuraOMV, Sapura Energy’s other assets include manufacturing yards in Lumut, Perak (273 acres or 110.48 hectares), Labuan Island (88 acres), and Teluk Karon, Terengganu (20 acres).

We have five derrick-laying vessels, six pipe-laying vessels, one subsea construction vessel, two anchor-handling tug supply vessels, and other marine support vessels. According to its official website, Sapura Energy also has five semi-tender rigs and six tender-assist rigs.

Sapura Energy remains a significant presence across the local upstream oil and gas ecosystem, trading between 4 sen and 6 sen over the past 52 weeks.

The group continued to be in the red in FY2024 as all segments were in the red, with a full-year net loss of RM1.1 billion and sales of RM728.4 million. Net operating cash flow for the year was RM311.29 million, with financing costs totaling RM805.51 million.

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