Thursday 28 Mar 2024
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KUALA LUMPUR (Aug 16): Dialog Group Bhd is buying an additional 25% stake in Haliburton Bayan Petroleum Sdn Bhd (HBP) for US$8.22 million (approximately RM34.5 million) cash.

In a bourse filing, the group said that its wholly-owned subsidiary Dialog D & P Sdn Bhd (DDPSB) signed a share purchase agreement (SPA) with Asia Energy Services Sdn Bhd (AES) to purchase an additional 25% stake in HBPSB.

As a result, DDPSB’s stake in the company will increase to 75% from the current 50%. As it stands, HBPSB is equally divided between DDPSB and AES.

The group said the acquisition provides the right opportunity for it to expand and deepen its upstream investments, thus increasing opportunities with its integrated technical services.

“This acquisition will result in the consolidation of HBP’s existing profit-generating business, and will thus immediately contribute positively to the group’s results,” said Dialog in the filing.

HBP is an independent technical service contractor for the Oilfield Services Contract (OSC), and entered into the contract with Petronas Carigali Sdn Bhd (PCSB).

The contract is for the provision of contractor services required for the enhancement of recoverable reserves from the Bayan Field, located offshore near Bintulu Sarawak, and having a term of 24 years (until 2036) .

Dialog added that it is optimistic of the future prospects of the Bayan Field, and is confident that HBP will contribute positively to its earnings for the remaining 18 years of the OSC.

“The purchase consideration for the acquisition will be financed by internally-generated funds and/or external borrowings,” Dialog said.

The group said the purchase price for the 25% stake was arrived at on a willing-buyer-willing seller basis, after taking into account HBP’s net asset value of US$18.6 million or RM78 million (as of June 30, 2019) — as well as HBP’s  future earnings contribution and potential business prospects.

It added the acquisition is expected to have an immediate positive effect on its earnings and net assets for the current financial year ending June 30, 2020 (FY20), while also contributing to long-term future earnings — with no material impact on its gearing, share capital and substantial shareholders’ shareholdings.

Dialog ended the week at RM3.53, giving it a market capitalisation of RM19.92 billion. A total of 13.11 million shares were traded today.

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