Home Fossil Energy Bumi Armada and MISC mulling over possible merger to combine drifting production companies
November 15, 2024, by Melisa Čavčić
Malaysia’s Bumi Armada is considering a service mix with the overseas sector of the compatriot shipping huge MISC Berhad (MISC), an owner and operator of overseas drifting and energy-related maritime options and services.
MMEGA FPSO style; Source: MISC
Bumi Armada verified its entryway into a non-binding memorandum of understanding (MoU) with MISC on November 14, elaborating that the tattooed MoU would allow it to check out a potential merger with the latter’s overseas organization by means of an all-share deal.
The verification of the duo’s reflection of a prospective merger follows the report mill entered into overdrive with tips that the set may combine their possessions to reinforce their position in the overseas drifting production sector.
The MoU works for 9 months from the signed date, up until the execution of the conclusive arrangement or termination of the MoU, whichever takes place faster, unless the duo makes other plans. The MOU is stated to have no legal and binding impact, aside from particular stipulations connecting to, to name a few, exclusivity and privacy.
According to Bumi Armada, the merger will develop a gamer amongst the “leading drifting production services worldwide with the scale, resources and monetary capability to complete in the growing and capital extensive overseas drifting production section.”
In addition, the company highlights that the proposed service mix will develop a Malaysian-based sector-focused entity that leverages “the combined skill swimming pool, task advancement and engineering ability, and knowledge of both MISC’s overseas company and Bumi Armada.”
Following the time out in big drifting production orders in Q1 2024, forecasts suggest that the worldwide need for these systems will be on to increase, anticipating 83 drifting production, storage, and offloading (FPSO) orders by 2030. If Bumi Armada and MISC concur to integrate their properties, the acquisition would enable the duo to improve their direct exposure in the growing market.
After more evaluation and conclusion of due diligence, the 2 business might accept continue with the proposed merger and participate in settlements on the conclusive contract. Bumi Armada highlights that there is no certainty that the MoU will lead to the conclusion of the proposed merger.
Just recently, the business’s wholly-owned subsidiary, Armada TGT (ATL) protected a two-year company duration extension for the FPSO Armada TGT1 by means of the execution of a bareboat charter agreement modification (BCC) addendum with Hoang Long Joint Operating Company (HLJOC) for the Te Giac Trang (TGT) field situated offshore Vietnam.
The extension started on November 15, 2024, and will end on December 7, 2026. The aggregate agreement worth is roughly $74.4 million. Because beginning operations at the TGT task, the FPSO Armada TGT1 is stated to have actually provided exceptional operating efficiency with absolutely no wasted time events and a typical oil and gas uptime above 98%.
MISC has actually likewise been hectic recently.