KUALA LUMPUR (Dec 27): Eversendai Corporation Bhd has entered into a RM28.17 million subscription agreement with Singapore listed Technics Oil & Gas Limited to subscribe for an aggregate of 10.7 million new ordinary shares, or 4.77%.
According to a filing to Bursa Thursday, Eversendai thus far has 29.6 million ordinary shares, representing 13.85% of the entire issued and paid-up share capital of Technics.
Eversendai first acquired an 11.9% stake in Terchnics on November 30 2012.
The strategic investment in Technics will enable Eversendai to secure a stronger footing in the oil and gas fabrication 3 sector, which is in line with the company's business plan to venture into inter-related sectors, it said.
"Eversendai would not only benefit from Technics' established track record in the aforesaid sector, but also Technics' expertise in compression systems and process modules, which are expected to complement the company's structural steel design, engineering and construction capabilities," Eversendai said.
"Capitalising on both parties' combined track record and expertise, it is expected that this strategic investment would enhance the shareholder value derived from venturing into the inter-related sector," it said in a statement.
But the proposed subscription will expose the company to risks inherent in Technics' businesses such as change in technology, general economic, political, regulatory, competition and operational risks and also fluctuation in the share price of Technics' shares.
The subscription will not have any effect on the issued and paid-up capital of Eversendai as the purchase will be satisfied entirely in cash and will not involve issuance of new Eversendai shares.