PETALING JAYA: SapuraKencana Petroleum Bhd (SKPB) is on track to raise RM1.64bil from a placement agreement with CIMB Investment Bank Bhd, Maybank Investment Bank Bhd and CIMB Securities (Si) Pte Ltd for a proposed placement of 587 million new SKPB shares at an issue price of RM2.80 per share to selected investors.
“The placement price was arrived at after taking into consideration the five-day, volume-weighted average market price of SKPB shares up to and including April 2 being the price-fixing date for the proposed placement of RM3.04,” the company said in a note to the stock exchange.
The company will release more details on the exercise in due course, which some analysts have deemed as “positive” for the stock should it go through as planned.
The proceeds would be used within a month to part satisfy the initial Seadrill Tender Rig Ltd (STRL) price of RM780.9mil on the STRL closing, and part satisfy the initial STRL price on the STRL closing in place of the portion that had been envisaged earlier to be satisfied by the issuance of three-year redeemable exchangeable preference shares or REPS to the tune of RM743.3mil.
The rest RM119.4mil meanwhile, would go towards defraying the expenses related to the proposed transaction and proposed placement.
SKPB also mentioned that it had submitted an application on the proposed exercise to the Foreign Exchange Administration of Bank Negara.
To recap, SKPB had late last year entered into a non-binding agreement to acquire Seadrill Ltd's tender rig business in a multi-billion-ringgit deal to be satisfied by a mix of shares and cash, a move that would see the former becoming a leading global player in the tender rigs and semi-tender rigs market.
In a recent research note to its clients, Maybank Investment Bank Research (MIBR) rated SPKB a “buy”, with a target price of RM4.10 on expectations of an upgrade in the near future.
“Consensus forecasts are conservative, in our view, for they do not fully reflect the impact from the STRL acquisition, which would add at least RM700mil per annum to earnings,” MIBR pointed out in the report, adding that “this Seadrill business, which has an enterprise value of US$2.83bil (RM8.72bil), would elevate SKPB's order backlog by 34% (+US$1.5bil (RM4.63bil)) to US$5.9bil (RM18.2bil) once the acquisition is concluded.”