KUALA LUMPUR (Dec 5): Uzma Bhd is planning to raise its stake in Setegap Ventures Petroleum Sdn Bhd to 49% from 30.02% currently, by acquiring an additional 18.98% stake or 271,210 shares in the company for RM28.5 million to boost its range of services.

Setegap Ventures (SVP) is the only local self-operating service provider of well pumping services, and was the recipient of Petronas’ Vendor Development Programme’s Best KPI Achiever Award in 2011 and 2012.

Uzma told Bursa Malaysia this afternoon that its wholly-owned subsidiary Tenggara Analisis Sdn Bhd (Tenggara) had today entered into an agreement with Datuk Nasri Nasrun and Mohd Zulhaizan Mohd Noor (the vendors) for the acquisition of the blocs of shares.

Upon the acquisition, Tenggara will hold 49% stake in Setegap Ventures Petroleum, with the remaining 51% stake  controlled by Nasri Nasrun (36%) and Mohd Zulhaizan (15%) respectively.

According to Uzma, the purchase consideration will be satisfied via cash payment of RM17 million,  which was part of the proceeds raised from a rights issue completed on July 21 this year.

The balance of RM11.5 million is expected to be satisfied via the issuance of 5.35 million new ordinary shares of Uzma at an issue price of approximately RM2.1495 per share.

Under the plan, Nasri Nasrun will get 4.23 million shares and the remaining 1.21 million shares will be allocated to Mohd Zulhaizan.

Uzma said the proposed acquisition is expected to boost its competitive advantage by being able to offer comprehensive well services to the oil and gas (O&G) operators for production enhancement.

According to Uzma, the acquisition represents an opportunity to increase its equity interest in a growing and profitable local company in the O&G sector.

"Since 2011 to 2013, SVP has managed to grow its revenue and profit after tax steadily, recording a compound annual growth rate (CAGR) of 39% and 31%, respectively.

"This is expected to further entrench Uzma's position as a specialised service provider in the O&G sector," it added.

Uzma's share price had been trading on an uptrend since beginning of the year, hiting a historical high of RM4.28 in early July.

However, the stock retreated almost 60% to trade below RM2 as of today.

As at midday, Uzma fell 5 sen or 2.86% to settle at RM1.70 with 491,500 shares done, giving it a market capitalisation of RM446.16 million.