KUALA LUMPUR (March 13): Cash-strapped Sapura Energy Bhd (KL:SAPNRG) will go through an additional due diligence process as a prerequisite to the government’s capital injection of RM1.1 billion and its restructuring exercise, according to Prime Minister Datuk Seri Anwar Ibrahim.
He said findings of the due diligence will be shared with relevant enforcement agencies, such as the Securities Commission, to determine if any action needs to be taken against any party.
Anwar, who is also finance minister, stated that this initiative is in addition to an audit process completed as part of the Practice Note 17 company’s restructuring exercise, which looks to address RM10.8 billion in debt and RM1.5 billion in unpaid trade bills.
Sapura Energy in a bourse filing on Tuesday said the government will inject RM1.1 billion into the company, through the subscription of redeemable convertible loan stocks (RCLS), exclusively to repay its 2,000 vendors, many of whom are small and medium enterprises (SMEs).
The capital injection will done through a Ministry of Finance Incorporated company, Malaysia Development Holding Sdn Bhd (MDH).
The funding will protect about 59,000 core industry jobs and preserve the company’s vital role as a key service provider to the oil and gas industry, according to a statement by its largest shareholder Permodalan Nasional Bhd on Wednesday.
WATCH: PM defends RM1.1b injection into Sapura Energy
Anwar, in defending the capital injection which he balked from calling a bailout, emphasised that the investment would not benefit Sapura Energy's shareholders or management. He also threw support behind a newly appointed professional management team to handle the restructuring.
“The government's injection is not a grant but an investment aimed at revitalising the oil and gas ecosystem, which is strategic for the national economy,” he said.
Sapura Energy underwent a leadership change this year with former SapuraOMV Upstream Sdn Bhd CEO Shahin Farouque Jammal Ahmad appointed as interim chairman and Muhammad Zamri Jusoh as new group CEO. They replaced Datuk Mohammad Azlan Abdullah, former chairman, and Datuk Mohd Anuar Taib, former group CEO and executive director, who had both resigned, citing "other personal commitments" and "personal endeavours" as reasons for their departure.
For the first nine months of FY2025, Sapura Energy posted a net loss of RM342.96 million, compared to a net profit of RM213.18 million a year before, while revenue increased 10.6% to RM3.54 billion from RM3.2 billion.
Last month, Sapura Energy gained creditor approval for its debt restructuring plan. The company also received court approval for the plan.
The company’s share price has been on an uptrend since announcement of the capital injection, hitting an eight month high of 4.5 sen earlier, giving it a market capitalisation of RM826.9 million. Year to date, the stock is up 50%.