Quick take: White knight rides to Barakah's rescue, shares soar

KUALA LUMPUR: Shares in Barakah Offshore Petroleum Bhd rose 18% on Tuesday after it found a white knight, Singapore’s Lecca Group Ptd Ltd, to revive the company.

The PN17 company is up 18.18%, or one sen to 6.5 sen. It is currently the most active counter with over 114.9 million shares traded. 

Barakah has proposed to undertake a regularisation plan that involves a share capital reduction, disposal of a pipelay barge, placement of shares and debt settlement schemes.

The company said that the proposed regularisation plan was formulated to address and uplift its PN17 status, by returning the company to a better financial standing and settlement of scheme creditors.

The proposed share capital reduction entails the cancellation of RM185.51mil of the issued share capital of Barakah, resulting in the reduction of the issued share capital from RM231.89mil to RM46.38mil.

The RM185.51mil credit will be used to set-off the accumulated losses of the company.

The second part of the regularisation plan is the proposed disposal of a pipelay barge by PBJV Group Sdn Bhd to Lecca Group Pte Ltd for US$21mil (about RM88mil) cash. 

The pipelay barge is a marine vessel that is primarily used for the laying of pipes underwater and is owned by Kota Laksamana 101 Limited (KL101).

The pipelay barge was commissioned for construction in 2009 at a cost of RM286.37mil, and was completed in September 2012.

In addition, Barakah intends to place out 375 million shares to Lecca at four sen per share under tranche 1 placement and RM25 million in nominal value of redeemable convertible unsecured loan stocks (RCULS-B) on a five-for-three basis. 

Consequently, Lecca Group will emerge as the single largest shareholder with 44.87% stake. 

Stock on the Move , Barakah