Propel Global Bhd’s 49%-owned subsidiary, Propel Oilfield Services Sdn Bhd, has entered into a binding term sheet with Reservoir Link Energy Bhd’s wholly owned subsidiary Reservoir Link Sdn Bhd (RLSB) for the acquisition of 30% equity in Propel Oilfield’s wholly owned subsidiary, Propel Maxflo Sdn Bhd, for RM7.39 million.
In a Bursa filing, Propel Global said the proposed disposal allows the company to partially unlock the value and monetise its investment in Propel Maxflo.
“At the same time, the proposed disposal also brings together two companies with highly complementary service offerings to create a mutually beneficial business partnership.
“It also provides an opportunity for Propel Maxflo and RLSB to leverage on each other’s established network in their respective geographical markets, resources and industry knowledge,” the company stated in the filing.
The company added that it has allocated around RM7 million from the proposed disposal for working capital requirements to finance its day-to-day operations and the remaining will be for the estimated expenses for the proposed disposal.
Propel Global said the proposed disposal will not have any effect on the issued share capital and shareholdings of the substantial shareholders of the company.
“Barring any unforeseen circumstances, the company is expected to realise an estimated net gain on disposal of approximately RM1.6 million arising from the proposed disposal,” it added while stating that the proposed disposal is expected to be completed by the second quarter of 2025.
RHB Investment Bank Bhd is the principal advisor for the proposed disposal.
