KUALA LUMPUR (Jan 21): TH Heavy Engineering Bhd (THHE) will explore opportunities in the renewable energy (RE) sector with an injection of renewable energy assets mainly comprising hydropower plant developments from OHP Ventures Sdn Bhd (OHPV) after signing a memorandum of understanding (MoU) with the latter.

In a statement on Friday (Jan 21), the Urusharta Jamaah Sdn Bhd subsidiary said the MoU is part of “an exercise to build capacity and capability by having new streams of assets to strengthen its financial footing via the diversification of its revenue stream”.

“Recently, THHE has actively formed strong strategic collaboration with established reputable partners with proven track record to regularise the financial conditions of THHE as well as to build its profile in an array of expertise. THHE is also in the final stage of strengthening its balance sheet,” the statement wrote.

The statement added that under the MoU, THHE and OHPV have “memorialised the intention of the parties to discuss and agree on further terms of its collaboration including the business model, corporate structure and other commercial terms that will pave the way for both parties to ink and finalise a definitive agreement”.

“I am honoured and delighted to see close collaboration between THHE and OHPV which will enable THHE to venture into the renewable energy spectrum via asset ownership business that will generate sustainable income to THHE. 

“This collaboration will also assist THHE in the formulation of a sustainable regularisation plan to Bursa Malaysia Bhd in accordance with the requirements under PN17 of the Main Listing Requirements,” Ahmad Yusof Mohamad, THHE’s executive committee member, said.

“With OHPV and its shareholders’ vast experience in [the] renewable energy sector, this momentous signing marks a significant cooperation and while creating the path for both companies to collaborate on asset ownership via development of power generation and other renewable resources,” OHPV’s director Mustakim Mat Nun said in the statement. 

To recap, THHE has been suspended from trading since Dec 10, 2021 after failing to submit a regularisation plan to Bursa Malaysia despite receiving seven extensions of time (EOT). 

The Practice Note 17 (PN17) company is currently in the midst of appealing against Bursa Malaysia’s decision to delist its securities from the official list as well as to grant it a further nine months up to July 22, 2022 for THHE to submit its regularisation plan for approval, according to its bourse filing on Jan 4, 2022.

THHE had fallen into PN17 status since April 2017, after its auditors expressed a disclaimer opinion on its audited financial statements for its financial year ended Dec 31, 2016.

At its last close price before suspension on Dec 9, 2021, it was trading at one sen per share and had a market capitalisation of RM22.21 million based on 2.22 billion shares.