KUALA LUMPUR (April 14): Practice Note 17 (PN17) company Reach Energy Bhd (KL:REACH) will have its shares suspended from trading on April 22, and may be delisted on April 24, after Bursa Malaysia Securities rejected its third extension request to submit a regularisation plan.

Bursa cited lack of material progress since the last deadline as the reason for rejecting the company's request to extend the submission deadline to Oct 2.

Reach Energy can appeal by April 21 to avoid delisting, but share trading will still be suspended.

Based on the previously approved timeline, Reach Energy was required to submit a regularisation plan for Bursa’s approval by April 2.

The company fell into PN17 status in April 2023, after its shareholders’ equity fell below 50% of its share capital as at the fiscal year ended Dec 31, 2022 (FY2022).

It has been loss-making since FY2014. For FY2024, Reach Energy’s net loss shrank to RM18.11 million from RM208.29 million a year earlier, as revenue remained largely unchanged at RM207.83 million.

Reach Energy was founded as a special purpose acquisition company (SPAC) in 2013, and launched a RM750 million initial public offering on the Main Market.

In 2016, the company acquired a 60% stake in Palaeontol BV for US$175.9 million (RM840.89 million). Palaeontol BV holds full interest in Emir-Oil LLP, which controls an 850.3 sq km onshore contracted area in southwestern Kazakhstan.

Following the acquisition, Reach Energy became the operator of the Emir-Oil concession block and secured exploration and production contracts valid until 2036.

In October 2024, it resolved a more-than-two-year lawsuit related to its sub-subsidiary Emir-Oil LLP (EO) in Kazakhstan. The dispute stemmed from a deferment of contractual obligations for the Dolinnoe's oilfield. 

It was resolved by payment of a reduced fine of RM9.6 million and a state duty of RM300,000. All the seizures of EO’s assets were also lifted.

Reach Energy’s largest shareholder, Super Racer Ltd — owned by Hong Kong citizen Cheung Siu Fai — holds a 48.5% stake in the company. Meanwhile, the group’s non-executive director, Tan Sri Azmil Khalili Khalid, owns a 2.66% stake.

As at end-December, the company’s total borrowings stood at RM40.95 million against deposits, cash and bank balances of RM3.35 million.

Reach Energy’s share price last traded at 1.5 sen a share, giving it a market capitalisation of RM31.9 million. Year to date, the stock is down 40%.

The article has been amended for accuracy. 

Read also:
Reach Energy slips into PN17 status a month after 4Q results
Reach Energy faces lower fine in Emir-Oil dispute, says Kazakhstan govt appealing against decision