Shareholders approve acquisition of Borneo Seaoffshore Engineering

Handal Resources Bhad (Handal) has received shareholders’ approval for the acquisition of Borneo Seaoffshore Engineering Sdn Bhd (BorneoSea), the establishment of the employees’ share option scheme (ESOS) as well as the proposed change of name from Handal Resources Berhad to Handal Energy Bhd.

Having obtained the approval at its extraordinary general meeting, the group expects to complete the transactions by the third quarter of 2019.

Handal Resources managing director Sunildeep Singh Dhaliwal said, “We are truly excited with the acquisition (of BorneoSea) which marks Handal’s venture into the big league. As a result of the acquisition, our outstanding order book increases by almost 30 per cent

“Since the incorporation of BorneoSea, we have turned it into a profitable company with strong ties in East Malaysia. With that being said, we will be having Sabahan shareholders on board which is in sync with our strategy to expand Handal’s presence into the East Malaysia energy market.

“I am very proud that we are able to have BorneoSea on board to fortify our current strengths and add value to the Group. With the additional expertise from BorneoSea, we are now positioned to aggressively pursue more contracts in the near future.”

The group will acquire 408,000 ordinary shares, representing a 51 per cent equity interest in BorneoSeafromSeaoffshoreCapital Sdn Bhd for RM25.5 million. This RM25.5 million is to be satisfied via the issuance of new Handal shares and new irredeemable convertible preference shares in Handal at an issue price of RM0.37.

The acquisition comes with a profit guarantee of RM5 million for the financial year ending June 30, 2020.

Handal will implement the ESOS of up to 10 per cent of the total Handal shares and also allocate this ESOS to eligible members of the board of directors.

As for the proposed change of name, the new name will give a be er reflection of Handal’s strategy as the Group ventures into the entire scope of energy related solutions provided by the Handal Group within the oil and gas industry.