KUALA LUMPUR (June 30): Sapura Energy Bhd (KL:SAPNRG) has received approval from Bursa Malaysia for its proposed regularisation plan, paving the way for the financially troubled oil and gas contractor to exit Practice Note 17 (PN17) status.
In a bourse filing, Sapura Energy said the approval, granted via a letter on Monday, covers key components of the regularisation plan, namely a capital reconstruction, debt restructuring, fundraising exercise and an exemption from undertaking a mandatory general offer.
The plan, spearheaded by Sapura Energy’s principal adviser MIDF Amanah Investment Bank Bhd, will now proceed subject to several conditions, including full compliance with Bursa’s Main Market Listing Requirements, submission of shareholder approval, and confirmation that all relevant regulatory approvals have been obtained.
The approval marks a major milestone for Sapura Energy’s long-awaited turnaround strategy, which was first announced in March. The plan entails reducing the group’s paid-up capital by 99.99%, and paring down total borrowings and trade liabilities from RM12.1 billion to RM5.23 billion.
It also involves a RM1.1 billion capital injection from the Ministry of Finance, via Malaysia Development Holding Sdn Bhd (MDH), through redeemable convertible loan stocks (RCLS).
Upon full conversion of the RCLS, MDH could become the single largest shareholder in Sapura Energy with a stake exceeding 33%, overtaking Permodalan Nasional Bhd, whose stake could be diluted to just over 5%.
Bursa’s approval requires Sapura Energy and MIDF to furnish quarterly updates on share issuances related to the conversion of its RCLS and redeemable convertible unsecured Islamic debt securities, ensure compliance with public shareholding spread requirements, and notify the exchange upon completion of the plan.
Following the implementation of a 20-to-one share consolidation exercise, Sapura Energy’s share base is expected to reduce to between 919 million and 1.01 billion shares.
Aside from MDH, three banks — Maybank Islamic Bhd, CIMB Bank Bhd and RHB Islamic Bank Bhd — are expected to emerge as substantial shareholders upon full conversion of their respective instruments, while Amanah Saham Bumiputera’s direct stake in the group could fall below 15%.
Shares of Sapura Energy closed 0.5 sen or 12.5% lower at 3.5 sen on Monday, valuing the group at RM643.16 million.
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