KUALA LUMPUR: SapuraCrest Petroleum Berhad (SapuraCrest) and Kencana Petroluem Berhad (Kencana), which are on track to be merged, expect the joint entity to morph into a serious contender in the international market and compete with global oil majors for more complex, capital intensive projects.
The RM11.85 billion merger of the two companies will result in the world's fifth largest oil and gas service provider is expected to take place by the first quarter of 2012.
The companies' boards of directors had recently established the Integration Committee, to be jointly chaired by SapuraCrest executivecice chairman and president Datuk Shahril Shamsuddin and Kencana group chief executive officer Datuk Mokhzani Mahathir.
In a joint statement on Wednesday, Aug 24, the expressed their keen interest to explore the opportunities and dynamics as a merged entity via Integral Key Sdn Bhd (IKSB), the special purpose vehicle wholly-owned by Mayban Ventures Sdn Bhd.
Shahril and Mokhzani said the companies viewed the merger as an enabler on multiple levels and the dynamics would work for the companies.
'With a suite of assets and services that clearly complement each other, we can unlock the full potential of our abilities as a combined company and move steadily into the next chapter of growth.'
'We are highly optimistic about fostering a solid partnership based on our mutual respect for each other and a shared vision to build an entity on a foundation of integrity, strong core values and merit. This is an absolute necessity to compete locally and on a global stage,' they said.
They said that while the business viability was undeniable, it ultimately boiled down to developing and retaining people, while exposing them to new possibilities.
'The integration of our workforce will have its share of challenges since it is likely the first of its kind in the history of corporate Malaysia that is not connected to a government-linked company.
'By tapping the significant collective intrinsic value of a deep talent pool and asset base, we plan to emerge as a vibrant oil and gas market player,' they said.
As a full-fledged integrated oil and gas service provider with strong delivery capabilities across the value chain, the merged entity will boost Malaysia's prospects as a serious contender in the international market and expect to compete with global oil majors for more complex, capital intensive projects, they said.
'The value chain of the oil and gas industry holds tremendous opportunity for the merged entity and when combined with the anticipated growth of upstream petroleum activities in the Asia Pacific region and beyond, the outlook is bright.
'Moving forward, we are confident we can continue to enhance the combined shareholders' value, while positively contribute to the development of Malaysia's energy sector and actualization of the nation's Economic Transformation Programme,' they said.
Under the cash and share swap deal also approved by both boards, IKSB will acquire all the assets and liabilities of SapuraCrest for a total consideration of RM5.87 billion and Kencana for RM5.98 billion.
The companies expect to secure 75% approval from each of their shareholders at extraordinary general meetings to be held by end-year.
The merger is being jointly advised by Maybank Investment Bank Bhd and CIMB Investment Bank Berhad.
The RM11.85 billion merger of the two companies will result in the world's fifth largest oil and gas service provider is expected to take place by the first quarter of 2012.
The companies' boards of directors had recently established the Integration Committee, to be jointly chaired by SapuraCrest executivecice chairman and president Datuk Shahril Shamsuddin and Kencana group chief executive officer Datuk Mokhzani Mahathir.
In a joint statement on Wednesday, Aug 24, the expressed their keen interest to explore the opportunities and dynamics as a merged entity via Integral Key Sdn Bhd (IKSB), the special purpose vehicle wholly-owned by Mayban Ventures Sdn Bhd.
Shahril and Mokhzani said the companies viewed the merger as an enabler on multiple levels and the dynamics would work for the companies.
'With a suite of assets and services that clearly complement each other, we can unlock the full potential of our abilities as a combined company and move steadily into the next chapter of growth.'
'We are highly optimistic about fostering a solid partnership based on our mutual respect for each other and a shared vision to build an entity on a foundation of integrity, strong core values and merit. This is an absolute necessity to compete locally and on a global stage,' they said.
They said that while the business viability was undeniable, it ultimately boiled down to developing and retaining people, while exposing them to new possibilities.
'The integration of our workforce will have its share of challenges since it is likely the first of its kind in the history of corporate Malaysia that is not connected to a government-linked company.
'By tapping the significant collective intrinsic value of a deep talent pool and asset base, we plan to emerge as a vibrant oil and gas market player,' they said.
As a full-fledged integrated oil and gas service provider with strong delivery capabilities across the value chain, the merged entity will boost Malaysia's prospects as a serious contender in the international market and expect to compete with global oil majors for more complex, capital intensive projects, they said.
'The value chain of the oil and gas industry holds tremendous opportunity for the merged entity and when combined with the anticipated growth of upstream petroleum activities in the Asia Pacific region and beyond, the outlook is bright.
'Moving forward, we are confident we can continue to enhance the combined shareholders' value, while positively contribute to the development of Malaysia's energy sector and actualization of the nation's Economic Transformation Programme,' they said.
Under the cash and share swap deal also approved by both boards, IKSB will acquire all the assets and liabilities of SapuraCrest for a total consideration of RM5.87 billion and Kencana for RM5.98 billion.
The companies expect to secure 75% approval from each of their shareholders at extraordinary general meetings to be held by end-year.
The merger is being jointly advised by Maybank Investment Bank Bhd and CIMB Investment Bank Berhad.
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