KUALA LUMPUR (Jan 15): Perisai Petroleum Teknologi Bhd, which is in a dispute with Emas Offshore Ltd (EOL), is now demanding that EOL sells its 49% stake in Emas Victoria (L) Bhd to Perisai for US$1.

This, said Perisai, is because EOL's restructuring exercise in 2017 allowed Perisai to terminate a 2013 shareholders agreement between the two parties.

In a filing with Bursa Malaysia, Perisai said its wholly-owned unit Perisai Production Holdings Sdn Bhd today served a notice to Emas Victoria on the termination event, namely EOL's restructuring plan announced in August 2017.

"EOL entered into a binding term sheet with certain potential investors as part of the financial restructuring of EOL and its subsidiaries.

"In connection with the restructuring, EOL voluntarily applied to the High Court under Section 211B(1) of the Companies Act," said Perisai.

The group said EOL's ongoing efforts to restructure its debts coupled with its application under the Companies Act showed that EOL had resolved to enter into a scheme of arrangement or compromise for the benefit of its creditors.

This, it added, amounted to an event of default under the Emas Victoria shareholders agreement.

Following on, Perisai said EOL is required to sell the 37.33 million shares (49% stake) it owns in Emas Victoria to Perisai Production Holdings within 30 days from Feb 14, 2018 at US$1.

On Dec 26, 2013, Perisai and EOL inked a shareholders agreement whereby Perisai acquired a 51% stake in Emas Victoria from EOL for US$89.25 million while EOL bought a 49% stake in SJR Marine from Perisai for US$37 million.

EOL terminated the agreement on Dec 8, 2016 after Perisai wanted to exercise a put option to sell its remaining 51% stake in SJR Marine to EOL for US$43.03 million.

On Dec 23, 2016, the two parties inked a settlement agreement, mutually agreeing for EOL to undertake the acquisition via US$20 million cash and the balance US$23.03 million in deferred payments.

On Sept 27, 2017, EOL said Perisai is obliged to complete the sale of its 51% equity interest in SJR Marine at US$1 following the lapsing of the 2016 settlement agreement.

EOL claimed that Perisai is required to comply with the 2013 agreement — which Perisai said was no longer effective following the termination by EOL — due to the lapsing of the 2016 settlement agreement.

Shares of Perisai rose half a sen or 11.11% to close at 5 sen today with 73.61 million shares traded, giving the oil and gas outfit a market capitalisation of RM63.04 million.