Mainboard-listed Eagle Brand Holdings has acquired 100% of Nam Cheong Dockyard Sdn Bhd and 50% of Nam Cheong Offshore through a reverse takeover deal.
Nam Cheong Group is a Malaysian-based international leading offshore marine group specialising in the building of offshore support vessels.
The acquisition price of $472 million for Nam Cheong was satisfied with the issuance of 94.4 billion new ordinary shares to the vendors at $0.005 each. In addition, 87,104,715 consideration shares were additionally issued to the vendors as a result of the shortfall in the cash portion of the company, pursuant to the deal agreement.
Founded in 1968 building only fishing vessels, Nam Cheong Group now focuses on the construction and engineering of offshore support vessels (OSVs) that are equipped with the latest technology for use in the offshore oil and gas exploration and production (E&P) and oil services industries including safety standby vessels (SSVs), anchor handling tug supply (AHTS) vessels, accommodation barges and multi-purpose accommodation workboats.
Says Leong Seng Keat, Executive Director of Nam Cheong Group, “We believe that the demand for OSVs will continue to shift towards vessels that are larger and more sophisticated in terms of engine capacity, offer greater stability, safety and more environmentally-friendly features, amongst other attributes. We have been working closely with renowned ship design firms like Rolls-Royce Marine AS for the use of their proprietary ship designs to build eight high-specs PSVs, the first of which is scheduled for completion in 2012.”
Nam Cheong is able to deliver up to 12 vessels (depending on the size and complexity of the OSVs) from its 12.6-hectare Miri shipyard located in Kuala Baram, Sarawak, Malaysia. In line with the increase in demand for Nam Cheong’s vessels in recent years, the group has outsourced the construction of vessels to selected shipyards in China, mainly in the Fujian province.
Over the last three years ended 31 December 2009, Nam Cheong’s revenue grew at a compounded annual growth rate (CAGR) of 66.8% per annum, from RM425.3 million ($176.4 million) in FY2007 to RM1,183.3 million in FY2009. Over the same period, profit from continuing operations grew from RM43.3 million in FY2007 to RM135.0 million in FY2009. For the nine months ended 30 September 2010, Nam Cheong’s revenue and profit stood at RM491.3 million and RM93.1 million respectively.
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