Shareholders of Sapura Kencana Petroleum Bhd are expected to approve its acquisition of the entire tender rig segment belonging to Seadrill, the leading Norwegian global drilling company, at the upcoming extraordinary general meeting on April 23, analysts said.
In what is surely a strategic acquisition that will position it as a world leader for tender rigs, they see no problem in getting shareholders approval, given the solid shareholding by owners and friendly parties.
The significance of this EGM is that it will be a watershed meeting for the company, the analysts said.
Shareholders' approval for the deal means that the merger and acquisition exercise becomes formalised and final.
In effect, it means the deal is done and the only remaining formalities are the transfer of monies and paperwork.
Analysts have said that as such, this massive deal worth US$2.9 billion would have been completed in a record six months or so.
The loan financing is in place and there is also a share issuance to satisfy the deal.
With the completion of the deal, Sapura Kencana becomes the world leader in the tender rig segment - the first time a Malaysian company has reached such a status.
Tender rigs are used in drilling up to a depth of 6,500 feet.
The deal enables one representative from Seadrill to sit on the Sapura Kencana board, bringing on a wealth of international experience, expertise and market connections.
Under the deal, Seadrill's stake in Sapura Kencana will rise to 12.5 percent from 6.4 percent.
The two companies won a Brazilian pipe laying vessel deal for US$1.4 billion and are awaiting results for another similar tender in Brazil.
Now Sapura Kencana can go into new markets such as in Africa and Mexico, armed with their tender rigs.
The work force will also expand to about 10,000.
Since the deal was announced, the company's share price has been rising with research houses clearly denoting it as a "buy" stock.
Against such a backdrop, shareholders would be eager to close the deal quickly and get on with what is surely a lucrative global business venture.
-- BERNAMA