Floating production, storage and offloading (FPSO) provider Yinson Holdings Bhd is acquiring up to 70% of Singapore’s Ezion Holdings Ltd, in a deal that will see Yinson providing a cash outlay of US$200mil (RM815.3mil) for the troubled offshore asset supplier.

The acquisition will be financed via a combination of internally generated funds and bank borrowings.

Yinson, via wholly owned subsidiary Yinson Eden Pte Ltd, has proposed to enter into a conditional debt conversion and conditional option agreement for the proposed debt conversion and subscription.

Yinson is also currently in talks with Ezion’s major secured lenders to acquire up to US$916mil (RM3.7bil) of Ezion’s existing loans through debt assignment, whereby Yinson will pay the lenders US$200mil and Ezion shares.

The Ezion shares to be held by Yinson come from the conditional debt conversion agreement, which allows Yinson to capitalise the debts into Ezion shares at 5.5 Singapore cents each.

Additionally, there is the conditional option agreement, which allows Yinson to subscribe up to 3.36 billion Ezion shares at an exercise price of 6.05 Singapore cents per share at any time during a five-year period commencing from the date of the issuance of options.

Upon completion of the debt conversion, Yinson will hold a minimum 70% equity in Ezion.

Yinson is also expected to retain the listing status of SGX-listed Ezion.

Ezion has net liabilities of US$254.8mil and posted a net loss of US$344.3mil for the financial year ended Dec 31, 2018.

Sourced by Star Online

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