Barakah Offshore Petroleum Bhd teams up with Vallianz Holdings Ltd to form a strategic alliance.
KUALA LUMPUR: Debt-laden oil and gas services company Barakah Offshore Petroleum Bhd
has entered into a memorandum of understanding (MOU) with Vallianz Holdings Ltd to form a strategic alliance for both parties’ to explore business opportunities in Malaysia and the Middle East.
Vallianz is 57.67%-owned by Saudi’s Rawabi Holding Company Ltd and is listed on the Catalist Board of the Singapore Exchange. The company owns and operates a young fleet of 76 offshore support vessels and covers markets in the Middle East, Asia Pacific and Latin America.
The development follows the resignation of Barakah’s chief executive office officer Nik Hamdan Daud last week to pave way for the restructuring of the loss-making company.
In a press release issued on Tuesday, Barakah said that by joining forces, both parties are able to leverage on each other’s strengths to expand their scope of services, technical capabilities and geographical reach along the oil and gas (O&G) value chain.
Under the MOU, will offer its engineering and operational capabilities to support Vallianz’s existing and future projects.
‘This includes technical consultation, feasibility studies, front-end engineering design and project engineering services, among others. The project scope also covers future co-tender arrangements for offshore projects which are deemed suitable by both parties,” the company said.
Barakah’s acting group chief executive officer Abdul Rahim Awang said the alliance is a springboard for the company to penetrate beyond Malaysia.
“Vallianz’s strong foothold in the Middle East opens up new opportunities for us to expand our reach into new markets while utilising our competencies and assets. The alliance also provides us access to various other assets that will
enable us to bid more competitively,” Abdul Rahim said.
Looking ahead, he said the company will continue to pursue similar strategic alliances in addition to tendering for more jobs.
“We are in the midst of formulating a debt restructuring scheme to manage the group’s debt. The successful completion of the debt restructuring exercise will put us on a firmer financial footing while relieving our cash flow in the short to medium term,” he added.
Barakah is saddled with RM335.6mil debts as of December last year.
Nik Hamdan’s who is Barakah’s major shareholder has been reducing his stake in the company in recent weeks, but still holds 31.1% as at April 19. He previously held 38.6% of the company’s shares.
Its other major shareholder, Samling Group has also been disposing its shares based on Bursa filings and now has an indirect 6.57% interest through Yaw Holdings Sdn Bhd.
Samling, the vehicle of Sarawak tycoon Tan Sri Yaw Teck Seng had invested in the stock in the middle of 2017 and held a 13.57% stake at one point.
Shares of Barakah closed unchanged at nine sen at midday with 18.16 million shares done.
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