KrisEnergy says AIH offer was for assets only, applies for fourth extension of debt moratorium

UPSTREAM oil and gas company KrisEnergy on Monday said it had received a confidential non-binding conditional offer from AlHassan International Holdings (AIH) in 2017, among others, to acquire certain assets of KrisEnergy.

But there was no offer from AIH to acquire any shares in the firm.

On Aug 27, The Business Times reported that AIH had proposed to pay KrisEnergy US$230 million for its stakes in several oil fields, and wanted to buy Keppel Corporation's 40 per cent stake in KrisEnergy.

A source also told BT that sale-and-purchase agreements were drafted but not signed, as the various parties could not agree on the terms. The source also said accepting the offer could have prevented KrisEnergy from ending up in its current position.

In a regulatory filing on Monday, KrisEnergy confirmed that it had received AIH's offer in 2017 to acquire certain assets of the company, but had also "engaged with various potential bidders" under a portfolio rationalisation exercise under its "new business plan" announced on Nov 3, 2016.

It also clarified that it did not receive an offer or proposal from AIH to acquire any stake or shares in the company.

KrisEnergy said that if completed, these asset offers are in the "company's ordinary course of the business of farming out oil and gas properties" and that the portfolio rationalisation was done to reduce the company's risk exposure in assets where it held a majority working interest, as well as to divest its non-core assets.

The company said that while it had entered into discussions with AIH to "seek to progress the asset offer", definitive asset sale terms were not agreed upon and no binding offer or agreement was ultimately reached or signed.

"Given that no binding offer was ultimately reached with AIH and the general complexity of such transactions, the company is of the view that no "potential lifeline" was passed up," said the company.

Separately, KrisEnergy announced that it has applied for a fourth extension of its debt moratorium by another two months to Oct 27. The hearing for the application will take place at 10am on Sept 7.

The firm is seeking protection from creditors including DBS Bank, Keppel Shipyard, Rubicon Vantage International and holders of the various notes the company has issued, while it tries to restructure debt of US$476.8 million.