Ideal Jacobs expects to complete RTO in first half of 2016

KUALA LUMPUR: The proposed reverse take over (RTO) of Ideal Jacobs (Malaysia) Corp Bhd of oil and gas consultation service providers Cekap Technical Services Sdn Bhd and MECIP Global Engineers Sdn Bhd for RM129 million is expected to be completed in the first half of 2016.

Ideal Jacobs executive director Chen Shien Yee said the the Securities Commission has asked the investment holding company to include some additional conditions in its proposal.

“We will be sending it back to them before mid-August and hope to get the approval in one to three months,” he told Bernama.

The company, which currently focuses on industrial printing with two factories in China, signed an agreement for the proposed RTO in June last year, believing it would create more value to shareholders.

For the financial year ended Dec 31, 2014, the group posted a pre-tax loss of RM4.28 milion against a pretax profit of RM1.36 million while revenue rose to RM38.54 million from RM36.04 million.

Asked if the RTO is the way to go amid the volatile oil market, Chen said the agreement was signed when oil prices were at their peak.

“The current situation is unexpected but we remain confident as analysts say the market would pick up next year,” he said, adding that the current oil price of US$60 per barrel is good enough to complete the exercise.

He also said that there would be a management buyout following the RTO, with the new management owning a 60 per cent share and current Ideal Jacobs shareholders holding the rest.

Cekap Technical Services Executive Chairman Sofiyan Yahya was reported as saying that the listed status of Ideal Jacobs provides both Cekap and MECIP a strategic gateway to another level of businesses.

Cekap has been a contractor for big names in the oil and gas sector like Petronas, Sarawak Shell Bhd, ExxonMobil, Talisman Malaysia Ltd and Murphy Oil Corp.

A special purpose vehicle, CMOG Group Sdn Bhd, has been incorporated to undertake the RTO exercise and, eventually, assume the listing status of Ideal Jacobs. — Bernama