SENERGY (5218) - Sapura Energy tumbles 9% on news of Mokhzani’s exit


KUALA LUMPUR: Shares of Sapura Energy Bhd

tumbled more than 9% in early Thursday trade following report that one of its substantial shareholders was looking to dispose his stake in the company.

The oil and gas services firm eased 15 sen, or 9.26% to RM1.47 with more than 26.7 million shares changed hands. It has gained about 3% so far this year.

The Wall Street Journal reported that that Tan Sri Mokhzani Mahathir’s private company, Khasera Baru Sdn Bhd was looking to sell up to RM901.5mil of shares in Sapura Energy, according to a term sheet.

The bookbuilding range for the offer, which represents 605 million Sapura Energy shares, or a 10.1% stake in the firm, was between RM1.42 and RM1.49 a share, according to the report.

It added that the offer represented an 8% to 12.3% discount to Sapura Energy's closing price of RM1.62 on Wednesday ahead of the bookbuilding launch.

In a recent report, RHB Research said Sapura Energy may likely face continued challenges in FY18, as it grapples with lower earnings from its drilling segment.

“The outlook for its engineering and construction (E&C) and energy segments, however, remains positive,” it said, adding that the orderbook for E&C remains stable while replenishment continues to be robust.

“Its energy segment is looking forward to its first gas production in 3QFY18, which would provide a recurring base of income.

“Maintain ‘buy’, with a lower SOP-based target price of RM2 (from RM2.20, 39% upside) as we adjust our assumptions on its drilling unit’s contributions and its balance sheet,” RHB said.