PETALING JAYA: Despite Deleum Bhd
not going through with its proposed acquisition of oilfield service assets and business from Thailand-based MPC Future Co Ltd, analysts believe there are still other opportunities ahead.
Deleum announced its plan to acquire MPC for RM60mil in June this year, with completion expected in the second half of 2025.
In a filing with Bursa Malaysia, Deleum said the purchase consideration of RM60mil was to be satisfied through a combination of cash payment and the issuance of new shares in its subsidiary, Deleum Oilfield Solutions (Thailand) Co Ltd (Dost).
Upon completion, Deleum would have held a 49.93% stake and MPC a 48.34% stake in Dost.
To recap, the oil and gas service provider terminated the deal due to key conditions outlined in the sale and purchase agreement not being met by the walk-away date.
These unmet conditions included the execution of novation agreements by Dost, MPC, and relevant parties for contract transfers, as well as obtaining written consent from MPC’s financiers for the transaction to proceed.
Deleum also did not receive written consent from MPC’s lenders that all debts related to the target assets had been settled and security interests released.
In a report, MBSB Research said the failed acquisition was not a setback and could, in fact, create valuable opportunities for the company to pursue future acquisitions with renewed focus and strategy.
According to the research firm, Deleum is actively seeking attractive acquisition targets in emerging markets, particularly in South-East Asia, to drive inorganic growth.
“Management has stressed its commitment to identify undervalued companies that can easily integrate into their operations and enhance existing synergies,” it said.
Deleum currently has an order book valued at RM1.51bil, providing visibility for the next five years.
Of this, 79% comprises oilfield integrated services projects, while the remaining 21% comes from the power and machinery segment.
In addition, the group is tendering for projects worth RM492mil, with an estimated hit rate of 50%.
MBSB Research is maintaining its estimates, as the failed acquisition has no impact on Deleum’s current operations.
The research house maintained its “buy” call on the stock, with a target price of RM1.92.
