Falcon Energy, subsidiary dispose shares in CH Offshore for S$20m in strategic move
MAINBOARD-LISTED Falcon Energy Group and its subsidiary Energian has disposed of 21.83 per cent of total shares in CH Offshore (CHO) for an aggregate consideration of about S$20 million, the group announced in a SGX filing on Friday.
Following the disposal to Singapore-incorporated SZ Offshore Investment, Energian still owns 64.91 per cent of total shares in CHO.
The consideration was arrived at after taking into account, among others, the adjusted net asset value of CHO of about US$197.45 million as of Dec 31, 2016.
The sale of CHO shares was considered a strategic move, said the group, in light of the current global trend of decreasing oil prices, and CHO's dependency on the oil and gas industry for its revenue.
The share disposal is to meet the group's pressing obligation to repay the CIMB term loan instalment, which is due. After that, there will be a remainder of S$4.32 million for its working capital purposes. The term loan is secured by the CHO shares charged to CIMB.
Besides repaying existing borrowings and working capital, the cash proceeds will also be used for other general funding requirements of the group.
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