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Merger & Acquisition
Transcript of Merger & Acquisition
A combining of two roughly equal size firm on roughly equal term and in which the shareholder remain as joint – owners
MERGER AND ACQUISITIONS
Type Of Merger
PRE –MERGER SITUATION
Establishing in 1977
100% Malaysian owned technology based organization
Merger & Acquisition
SAPURAKENCANA PETROLEUM BERHAD
A Malaysia-based investment holding company
KENCANA PETROLEUM BHD
SAPURAKENCANA PETROLEUM BERHAD
Is one of the world's largest integrated oil and gas services and solutions provider
ADVANTAGE AFTER MERGER
POST - MERGER SITUATION
A purchase of one firm by another with associated implication of financial and managerial domination
OVERVIEW OF THE COMPANIES
Growth in new business and market capitalising on larger combined balance sheet
End-to-end operation harmonisation
Securing turnkey EPCIC projects..
REASON FOR SUCCESS
Sapurakencana are integrated service provider covering the oil & gas value chain with full fledged EPCIC capabilities.
To create the larger oil service provider.
merger on 12 mei 2012.
Merger through an RM11.85 billion merger exercise to create the largest oil service provider by assets in the country soon to be known as SapuraKencana Petroleum Bhd.
To drive strong performance and deliver exceptional value.
Expanding their business proposition and recently added an offshore diving services capability to their portfolio.
Possesses an enlarged integrated services offering that encompasses Kencana core business of providing engineering and fabrication services.
September 2011, it’s wholly owned subsidiary, Kencana Petroleum Ventures Sdn. Bhd., incorporated Kencana Marine Rig 2 (Labuan) Pte Ltd and Kencana Marine Rig 3 (Labuan) Pte Ltd.
December 2006 on the main Market of Bursa Malaysia Securities Berhad, Kencana Petroleum is strategically positioned as the preferred integrated solutions and services provider for the upstream oil and gas industry.
Has expanded and diversified its businesses across four major business areas
Sapura's business is backed by a fundamental belief in integrating People with Technology
Sapura's persistent efforts in capability-building of home-grown talents and aggressive investment in R&D have positioned the Group to be globally competitive, producing highly-specialized and multi-skilled pool of technology experts
Capabilities and competencies that cover the full lifecycle of systems and products
With a workforce of over 12,000 people, the Group's global presence can be seen in over 20 countries ranging from Malaysia and China to Australia, Middle East, America, and Brazil and beyond
Providing end-to-end solutions and services to the upstream petroleum industry, and covers activities
SapuraCrest's shareholders would collectively hold approximately 49.94% while Kencana shareholders will own 50.06% in Integral Key
Integral key sdn bhd acquire SapuraCrest and Kencana Petroleum Sdb Bhd Bhd
Under a cash and share swap deal, a special purpose vehicle called Integral Key Sdn Bhd would be buying all the assets and liabilities of SapuraCrest for RM5.87billion and Kencana for RM5.98billion.
Have scale driven cost efficiencies.
Have quality control and safety track record.
Have experienced management and skilled technical team.
Establish track record and financial strength.
Sapurakencana have international partnership to support their businesses.
Sapurakencana have a large asset base to support their businesses.
• Ready in house asset.
• Order book of RM14billion and growing.
• Strong partners like Seadrill.
• ETP: development of marginal and deepwater field’s opportunities in Southeast Asia, Brazil and Australia.
• Delivery new asset.
• Capital intensive.
• Shortage of skilled personnel.
• Substantial drop in oil price could curb E & P works.
• Competitors stepping up their game, example more drillers.
• Delay in new asset deliveries.
THE COMBINATION OF SAPURACREAST SDN BHD WITH KENCANA PETROLEUM BHD LEAD LARGEST OIL & GAS PROVIDER TO THE WORLD
TWO HEAD IS BETTER THAN ONE - POTENTIAL GAINS AVAILABLE THROUGH THE COMBINING, INCREASE MARKET POWER, ECONOMIES SCALE.
purpose of merger
I. The combined sapuraCrest business and kencana petroleum under SapuraKencana will make them integrated services provider covering the oil & gas value chain with full- fledged EPCIC capabilities
II. The merger is expected to enhance our market position and competitiveness bring about cost saving.
III. Will help support growth opportunities and act as a platform to further strengthen our presence globally
IV. Will help our country to achive objectives under the Economic Transformation Program to transfer Malaysia into an Asian hub for the oil & gas industry.