THHE unit reactivates Petronas licence

THHE unit reactivates Petronas licence
Business & Markets 2013
Written by Charlotte Chong of theedgemalaysia.com
Wednesday, 14 August 2013 09:32

KUALA LUMPUR: TH Heavy Engineering Bhd (THHE), which was suspended when it was designated a PN17 company in February 2010, has reactivated its oil and gas (O&G) crane manufacturing licence from Petroliam Nasional Bhd (Petronas).

In an announcement to Bursa Malaysia yesterday, THHE said its wholly owned subsidiary, O&G Works Sdn Bhd (OGW), was awarded an extension of the licence for mode of operation.

"The award of this licence qualifies OGW to tender and participate in upcoming works, namely the offshore pedestal cranes of various types and lifting capacities for Petronas and other major oil operators in Malaysia," said THHE.

The participation as a manufacturer of offshore pedestal cranes is expected to make a positive contribution to the earnings and net assets of OGW and the THHE group for the current and future financial years.

THHE said the standardised work and equipment code (SWEC) applied is mechanical-crane-pedestal.

Fomerly known as RAMUNIA HOLDINGS BHD [], the O&G fabrication company fell into PN17 status when the company's auditors expressed a modified opinion regarding its audited consolidated financial statements for 2009.

Its shareholders' equity on a consolidated basis being less than 50% of its issued and paid-up capital was also an issue.

In 2010 Ramunia sold its main asset, a fabrication yard and machinery in Teluk Ramunia, Johor, to SIME DARBY BHD [] for RM515 million.

Although without a core business with the sale, Ramunia was able to settle its debts and look for a new business.

Since then, THHE has completed its regularisation plan by raising RM106 million via a rights issue and acquiring a fabrication yard in Pulau Indah for RM83.8 million. It changed its name to THHE.

THHE exited PN17 in October 2012.

Pilgrim fund Lembaga Tabung Haji is the largest shareholder with a 32% stake in THHE, according to THHE's 2012 annual report.

Billionaire banker Tan Sri Quek Leng Chan had subscribed for 10% of THHE shares through a private placement at 45 sen for RM41.8 million via GuoLine Capital Ltd on May 8 this year.

At the recent AGM and EGM, THHE managing director and CEO Nor Badli Mohd Alias said the company had teamed up with McDermott International Inc to bid for RM1 billion worth of engineering, procurement, CONSTRUCTION [], installation and commissioning contracts. The outcome of the bidding process will be released by October, he said.

Shareholders unanimously approved the establishment of a joint venture between THHE and McDermott International and two share swap exercises involving the subsidiaries of both companies.

Under the share swap, McDermott will acquire 30% of THHE's subsidiary, THHE Fabricators Sdn Bhd, while THHE will acquire 30% of McDermott's local unit, Berlian McDermott Sdn Bhd.



This article first appeared in The Edge Financial Daily, on August 14, 2013.