KUALA LUMPUR: Oil and gas (O&G) service provider Yinson Holdings Bhd is exiting its logistics and trading business to focus on its burgeoning floating production, storage and offloading (FSPO) business.

It is divesting its logistics and trading subsidiaries to the group’s major shareholders and executive directors Lim Han Weng and his wife Bah Kim Lian — via Liannex Labuan Ltd (LL)— for RM228 million. 

LL is wholly-owned by Liannex Corp (S) Pte Ltd, which is wholly-owned by Lim and Bah. 

In a statement yesterday, Lim, who is the executive chairman of Yinson, said proceeds from the disposal of the group’s six non-O&G subsidiaries would enable it to drive a centric focus business operation and reinvest the proceeds in more lucrative O&G projects with higher project internal rate of return. “Our long-term objective is to develop Yinson into the most profitable global FSPO,” he said.  Yinson said disposal proceeds will also be used to partly repay inter-company loans owing to the group by the six companies, namely: Yinson Corp Sdn Bhd, Yinson Transport Sdn Bhd, Yinson Shipping Sdn Bhd, Yinson Port Ventures Pte Ltd, Yinson Vietnam Co Ltd and Yinson Power Marine Sdn Bhd. 

The offer is subject to, among others, LL being satisfied with the findings of a due diligence of the six units, and approval from Yinson’s board of directors and shareholders at an extraordinary general meeting to be convened.  

This article first appeared in The Edge Financial Daily, on June 30, 2015.