DAYANG Enterprise Holdings Bhd is in talks for its maiden purchase, a local company involved in niche product fabrication and installation for the oil and gas industry.
Dayang, which provides oil rig maintenance and marine charter, may take a controlling stake or buy all of the company's shares, managing director Tengku Yusof Tengku Ahmad Shahruddin said.
"We have been talking since June. The company wants to grow its business and needs funding. If the price is right and it can complement Dayang, we will buy it by early next year," Tengku Yusof told Business Times at a briefing in Kuala Lumpur yesterday.
Tengku Yusof said Dayang will probably invest less than RM50 million for the purchase and it will be a profitable venture.
At the briefing, Tengku Yusof said that Dayang, which owns four workboats and a supply boat, may expand its chartering business by buying more vessels.
It has long-term charters with Petronas Carigali Sdn Bhd for its first three vessels until 2010.
The fourth vessel, Dayang Nilam, worth RM22 million, is being upgraded and will start operations from August. The fifth vessel, Dayang Zamrud, worth RM51.5 million, will be delivered by mid-2009.
"Long-term charter rates range from RM50,000 to RM100,000 a day. It's a good business. We are buying also to reduce third-party dependency," he said.
Dayang is optimistic of achieving 15 per cent growth in revenue and net profit for financial year 2009, based on current projects, new jobs it hopes to get, and charter contracts for its two new vessels.
Dayang has bid for RM1 billion worth of contracts from Talisman, Petronas Carigali and US-based Murphy Oil in the last three months.
The company hopes to get at least 30 per cent of the jobs, which will keep it busy for two to three years.
"We will know the results for some of the contracts by the end of this year," Tengku Yusof said.
Source : Business Times
