Results were weighed down by the drilling services and oilfield services segments that reported lower revenues mainly due to softer time charter rates from drilling contracts and weaker demand for oilfield services
KUALA LUMPUR: Ekuiti Nasional Bhd (Ekuinas) has cancelled the proposed consolidation of involving UMW Oil & Gas Corporation Berhad (UMW-OG), Icon Offshore Bhd
and Orkim Sdn Bhd.
Ekuinas CEO Syed Yasir Arafat Syed Abd Kadir said on Thursday the UMW-OG exercise required significant capital, much larger than initially envisaged.
Ekuinas, which is a government-linked private equity fund management company, announced that it had, with the agreement of UMW-OG, terminated the two separate share purchase agreements between the two parties on Jan 19, 2017.
The agreement was to facilitate the proposed consolidation of UMW-OG, Icon and Orkim.
Syed Yasir explained: “We arrived at the decision after considering the significant capital requirements of UMW-OG which necessitates a far larger recapitalisation than initially envisaged.
“This, in turn, would have an adverse effect on the economics of the proposed transaction. In the meantime, we will support our investee companies, Icon and Orkim, in executing their strategies to grow their respective businesses in the pursuit of shareholder value creation.
“We would like to thank all the parties involved in the discussions for their time and effort, and we wish UMW-OG all the best in their recapitalisation exercise.”
Trading in the securities of UMW-OG and Icon was voluntarily suspended since 9am on Thursday after the proposed corporate exercise was put on hold.
StarBiz reported that UMW-OG’s proposed takeover of Icon Offshore and Orkim was put on hold as the proponents of the deal were unsure if shareholders’ approval could be obtained to see through the multi-billion-ringgit transaction.
The deal was backed by UMW-OG’s major shareholder Permodalan Nasional Bhd (PNB) and Ekuinas, which owns major stakes in both Icon and Orkim.
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