Friday 29 Mar 2024
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KUALA LUMPUR (Oct 17): Sapura Energy Bhd, formerly SapuraKencana Petroleum Bhd, today announced that it is discontinuing its joint venture with London-based Subsea 7 S.A.

In a statement to Bursa Malaysia, it said the two entities have mutually agreed today to discontinue their SapuraAcergy JV.

Consequently, SapuraAcergy's heavy-lift and pipelay vessel, Sapura 3000, has been sold to Sapura Energy, which has now become the sole owner of the vessel.

"Having full ownership of Sapura 3000 will further enhance the group's competitive positioning in the engineering and construction segment," Sapura Energy said.

"Sapura 3000 has established a strong track record in executing heavy-lift, pipelay and decommissioning work for shallow and deepwater projects globally, including projects in Mexico, Japan, China, Australia and the Southeast Asia region," it added.

According to the filing, this transaction is not expected to have a material effect on the net assets of Sapura Energy, but will be recognised as a loss in the JV for the current financial year ending Jan 31, 2018.

Subsea 7, incorporated in Luxembourg, is a subsea engineering, construction and services company serving the offshore energy industry.

In a statement on its website, Subsea 7 said the decision to discontinue the 50:50 JV reflects the "evolution of both companies' long-term strategic priorities", and that Subsea 7 remains committed to the Asia Pacific region, with offices located in Malaysia, Australia, Indonesia and Singapore.

"As a result of the discontinuation of the joint venture and the sale of Sapura 3000, Subsea 7 expects to receive approximately US$100 million in cash dividends, and recognise a loss of approximately US$10 million in the third quarter," it said.

Subsea 7 also said its share of net income from SapuraAcergy in 2016 was US$6 million. As at Dec 31, 2016, the carrying amount of the investment was US$129 million.

"SapuraAcergy comprises two jointly owned entities, SapuraAcergy Assets Pte Ltd and SapuraAcergy Sdn Bhd. All SapuraAcergy's projects have been completed and its entities will be liquidated in due course," its statement further read.

Sapura Energy's shares closed at RM1.48 today, down 1 sen or 0.67%, giving it a market capitalisation of RM8.928 billion.

 

 

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