OIL and gas service provider Petra Perdana Bhd has entered into an agreement to acquire a 70% stake in Yong Choo Kui Shipyard Sdn Bhd for RM22.7mil cash.
Petra said in a statement yesterday that Yong Choo was a Sarawak-based shipbuilding and ship repair company. The stake in this company will be bought from Yong Choo Kui and Loh Teck Huat.
It was taken into account that there is a guarantee of a net profit of RM3.15mil for the year ending Dec31, 2005, based on the 70% stake that Petra is acquiring, and the earnings potential of Yong Choo.
“We are extremely delighted with the acquisition. Apart from the profit guarantee, which will contribute positively to the group's performance in 2005, the acquisition will also be in line with Petra's overall strategy in becoming a more diversified oil and gas service provider,” said Petra executive chairman Tengku Datuk Ibrahim Petra.
Yong Choo's role in shipbuilding and ship repair services will provide the Petra group with an in-house ship repair centre and source of fleet renewal.
“We will also be able to take advantage of the current and long-term demand for marine support as well as strengthen our market resilience in the oil and gas industry,” Tengku Ibrahim said.
Yong Choo has built more than 300 vessels, comprising supply boats, barges, tug boats, cargo vessels, ferry boats and crew boats since its incorporation in 1992.
Located in Sibu, Yong Choo's facility is equipped to build vessels exceeding 100m in length and it has a capacity to accommodate 20 vessels at any one time.
The proposed acquisition will be settled by way of cash through internally generated funds and bank borrowings, and is expected to be completed before the end of this year.
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