Ezion to dispose of stakes in Strategic Offshore and Rotating Offshore

Singapore five-dollar note Photo by Leslie Shaffer

Ezion Holdings has entered deals to dispose of its 50 percent interest in indirect joint venture Strategic Offshore Ltd. (SOL) and its 30 percent stake in associate Rotating Offshore Solutions (ROS), the company said in a filing to SGX Friday.

The transactions are aimed at streamlining the company’s asset base and cutting its operational costs, Ezion said.

Ezion Investments, a wholly owned subsidiary of Ezion Holdings, has entered a deal to sell its stake in SOL, which is a Malta-based dormant company, for a nominal consideration of US$1.00, the filing said.

The buyer is an unrelated Singapore-based oil and gas management company, Ezion said.

The carrying value of the SOL investment is nil, and SOL has a net liability position of US$4.94 million, Ezion said, adding that SOL is money-losing and doesn’t contribute any revenue.

Ezion said it will sell its 30 percent ROS holding to current ROS shareholders Murugesan Srinivasan and Lim Boon Chye Victor and to ROS.

Murugesan Srinivasan and Lim Boon Chye Victor — who each have 35 percent effective interests in ROS — will each acquire a 5 percent stake in ROS from Ezion for S$250,000, or around US$180,989, as well as deferred cash consideration equivalent to 0.25 percent of ROS’ sales revenue for 2020 through 2023, Ezion said.

ROS, which is a specialized engineering services provider, will buy back the remaining 20 percent of itself for S$2.5 million, or around US$1.81 million, the filing said.

Ezion said the estimated carrying value of its ROS investment is nil as of end-September, with ROS in a net asset position of US$18.90 million.

The transactions are expected to be completed by 30 November, the filing said.

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