Friday 29 Mar 2024
By
main news image

KUALA LUMPUR (Dec 21): Sapura Energy Bhd shares fell as much as 1.5 sen or 5.17% to a record intraday low at 27.5 sen so far today after crude oil prices dropped 5% overnight on Thursday.

At 11:39am today, shares of the oil and gas support services provider were traded unchanged at 29 sen with about 44 million shares exchanging hands. The stock was among the most-active counters across Bursa Malaysia.

On crude oil markets, Reuters reported that oil prices fell about 5% on Thursday, hitting their lowest level in more than a year on worries about oversupply and the outlook for energy demand as a US interest rate rise knocked stock markets.

Brent crude futures fell US$2.89 (RM12.08), or 5.05%, to settle at US$54.35 a barrel. US West Texas Intermediate (WTI) crude futures fell US$2.29, or 4.75%, to settle at US$45.88 a barrel. Brent hit a session low of US$54.28 a barrel, its lowest price since mid-September 2017, while WTI sank to US$45.67, its lowest price since late August 2017.

At Bursa today, Sapura Energy shares are trading below the company's proposed rights share price of 30 sen each.

This raises concerns over the group's cash call. The Edge Financial Daily reported today that Sapura Energy's share price at below 30 sen is seen as a challenge to the group's cash call.

The daily quoted Phillip Capital Management Sdn Bhd chief investment officer Ang Kok Heng as saying that since it is cheaper to obtain Sapura Energy shares on the open market, investors will have to reconsider subscribing for the rights issue.

"Investors, portfolio managers and underwriters are not like the company's owner; they have a different level of loyalty. The owner may be convinced on the long-term prospects and doesn't mind paying a premium, but for investors like portfolio managers, they will start to be pressured if their investments are not making money for one or two years," Ang said.

On Aug 24 this year, theedgemarkets.com reported that Sapura Energy had proposed the rights issue of new ordinary shares besides Islamic redeemable, convertible preference shares (RCPS-i) in the company to raise up to RM3.98 billion to reduce borrowings.

Sapura Energy said a Bursa filing then, the rights issue of up to 9.99 billion new ordinary shares at 30 sen each involves 998.69 million free warrants. The exercise will be undertaken on the basis of five rights shares for every three shares held and one warrant for every 10 rights shares.

The group said the rights issue of up to 2.4 billion RCPS-i at 41 sen each is on the basis of two RCPS-i for every five shares held.

      Print
      Text Size
      Share