Maybulk offers to sell 21% of POSH to shareholders

PETALING JAYA: Malaysian Bulk Carriers Bhd (Maybulk) proposes to sell its entire 21.23% stake in Singapore-listed PACC Offshore Services Holdings Ltd (POSH) to its shareholders via a renounceable restricted offer for sale (ROS) exercise involving up to 386.39 million POSH shares.

On a pro-rate basis, 386 offer shares are available for sale for every 1,000 existing Maybulk shares held, according to its filing with the stock exchange.
POSH is involved in offshore marine support services. Kuok (Singapore) Ltd is its largest shareholder with a 60.3% stake.
For illustrative purposes, based on the discount range of between 15% and 30% to the five-day volume weighted average market price of POSH shares of RM1.1043 (S$0.3720), the indicative offer price range will be between 77.3 sen (S$0.2604) and 93.87 sen (S$0.3162) per offer share.
Assuming that all the offer shares are fully taken up by the entitled shareholders based on an indicative offer price of 88 sen, the estimated gain to Maybulk from the proposed disposal is RM337.2 million. To date Maybulk has invested RM1.1 billion in POSH.
Maybulk noted that the disposal is due to the need to raise funds to strengthen its future operations given the weakness in the dry bulk and offshore services sectors in the recent years, which has resulted in a cash flow constraint.
“As such, the group has decided to undertake the proposed disposal through the proposed ROS to monetise its investments in POSH and raise the cash required to finance its working capital, part finance the construction costs of new vessels and repay part of its borrowings. This will enable the group to focus on its core business activity in the dry bulk sector.”