KUALA LUMPUR (Sept 12): Sapura Energy Berhad rose 2.98% in active trade at mid-morning today after the company said it is disposing a 50% stake in its unit Sapura Upstream Sdn Bhd to OMV Akteingesellschaft (OMV AG), signalling it is opting for a stake sale rather than an IPO avenue to pare down its debts.

At 10.10am, Sapura Energy rose 1 sen to 34.5 sen with 46.45 million shares done.

In a filing to Bursa Malaysia this morning, Sapura Energy said it had entered into a Heads of Agreement (HOA) with OMV AG for the transaction.

It said the transaction is based on an enterprise value of US$1.6 billion.

Sapura Energy said OMV AG is one of Austria’s largest listed industrial companies with group sales of €20 billion.

It said that in upstream, OMV AG has a strong base in Romania and Austria and a balanced international portfolio, with the North Sea, the Middle East & Africa and Russia as further core regions.

2017 daily production stood at approximately 348,000 barrels of oil equivalent per day (“boe/d”), it added.

On the rationale of the deal, Sapura Energy said the strategic partnership will comprise its portfolio of commercially viable gas assets offshore Sarawak, its acreage in new markets in New Zealand, the Gulf of Mexico and Australia, and it will benefit from Sapura Energy’s in-house capabilities.

“OMV AG’s existing global core regions offer new market opportunities for upstream and for Sapura Energy’s services segment,”it said.