Reach Energy chief executive officer Tan Siew Chaing
KUALA LUMPUR: Reach Energy Bhd
has completed the proposed debt settlement amounting to RM206.51mil or approximately 76% of the debt owing to Super Racer Limited (SRL).
The completion signals SRL’s emergence as a major shareholder with 1.032 billion shares, or 48.5% of the enlarged issued share capital.
In a statement, Reach Energy said the completion of the proposed debt settlement also marked SRL’s entry into a shareholder loan facility agreement to make available a shareholder loan facility of up to US$5mil or RM22.87mil to the company.
“Approximately RM20.37mil or 89% of the total proceeds from the shareholder loan facility will be used for working capital which encompasses the day-to-day administrative, operational and financing expenditure as well as general corporate purposes,” it said.
Chief executive officer Tan Siew Chaing said the completion of this corporate exercise represented a new beginning for Reach Energy.
“SRL shares our vision, and with the available funding, we will not only be ensured of sustainable operations but we will also be able to pursue opportunities and plans that will accelerate our growth.”
“Our first course of action will be to increase our productivity and efficiency, especially our production volume. To achieve this, the drilling of more development wells is high on the agenda in the near term.
“We also intend to install and replace electrical submersible pumps while simultaneously continuing gas injection measures which are crucial to improve reservoir pressure and ultimately increase our production volume,” Tan said.
Concurrent with the completion of the proposed debt settlement, Reach Energy had also completed the proposed exemption of SRL and Cheung Siu Fai, as the person acting in concert with SRL, from the obligation to undertake a mandatory take-over offer for the remaining Reach Energy shares.
