ICON OFFSHORE BERHAD Reg. No. 201201011310 (984830-D)
(Incorporated in Malaysia) PART A
CIRCULAR TO SHAREHOLDERS IN RELATION TO THE
(I) PROPOSED ACQUISITION BY ICON EXPLORER (L) INC, A WHOLLY-OWNED SUBSIDIARY OF ICON FLEET SDN BHD (“ICON FLEET”) WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF ICON OFFSHORE BERHAD (“ICON”), OF THE “PERISAI PACIFIC 101” RIG (AS DEFINED HEREIN), AN ASSET MORTGAGED TO OVERSEA- CHINESE BANKING CORPORATION LIMITED, LABUAN BRANCH (“OCBC LABUAN”) AND OVERSEA-CHINESE BANKING CORPORATION LIMITED, SINGAPORE (“OCBC SINGAPORE”) FROM PERISAI PACIFIC 101 (L) INC (“PP101”), A WHOLLY-OWNED SUBSIDIARY OF PERISAI DRILLING HOLDINGS SDN BHD (“PDHSB”) WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF PERISAI PETROLEUM TEKNOLOGI BHD. (“PPTB”) FOR THE MOA SALE PRICE (AS DEFINED HEREIN) (“PROPOSED RIG ACQUISITION”)
(II) PROPOSED ACQUISITION BY ICON FLEET, A WHOLLY-OWNED SUBSIDIARY OF ICON, OF 51,000 ORDINARY SHARES IN PERISAI OFFSHORE SDN BHD (“POSB”) REPRESENTING 51% OF THE ISSUED SHARE CAPITAL OF POSB FROM PPTB FOR A TOTAL CONSIDERATION OF RM1,058,122.50 EQUIVALENT TO USD255,000.00 (“PROPOSED SHARE ACQUISITION”)
(III) PROPOSED ACQUISITION BY AND ASSIGNMENT TO OMNI VENTURES SDN BHD, A WHOLLY-OWNED SUBSIDIARY OF ICON FLEET WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF ICON, OF THE ASSIGNED INTELLECTUAL PROPERTY (AS DEFINED HEREIN) FROM PERISAI DRILLING SDN BHD (“PDSB”), A WHOLLY- OWNED SUBSIDIARY OF PDHSB WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF PPTB FOR A PURCHASE CONSIDERATION OF RM2,074,750.00 EQUIVALENT TO USD500,000.00 (“PROPOSED ACQUISITION AND ASSIGNMENT OF IP”)
(THE PROPOSED RIG ACQUISITION, THE PROPOSED SHARE ACQUISITION AND THE PROPOSED ACQUISITION AND ASSIGNMENT OF IP ARE COLLECTIVELY REFERRED TO AS, “PROPOSED ACQUISITIONS”)
(IV) PROPOSED VARIATION OF THE UTILISATION OF PROCEEDS RAISED FROM THE RIGHTS ISSUE OF SHARES WITH WARRANTS (“PROPOSED VARIATION”)
(V) PROPOSED DIVERSIFICATION OF THE EXISTING PRINCIPAL ACTIVITIES OF ICON AND ITS SUBSIDIARIES TO INCLUDE OFFSHORE DRILLING BUSINESS ARISING (AS DEFINED HEREIN) FROM THE PROPOSED ACQUISTIONS (“PROPOSED DIVERSIFICATION”)
(THE PROPOSED ACQUISITIONS, THE PROPOSED VARIATION AND THE PROPOSED DIVERSIFICATION ARE COLLECTIVELY REFERRED TO AS, “PROPOSALS”)
PART B
PROPOSAL TO MAKE AN OFFER ON THE EMPLOYEES’ SHARE OPTION SCHEME AND EMPLOYEES’ SHARE GRANT PLAN TO THE MANAGING DIRECTOR OF ICON
AND
NOTICE OF EXTRAORDINARY GENERAL MEETING Principal Adviser for Part A
Registration No. 197401003530 (20657-W)
The Notice of Extraordinary General Meeting (“EGM”) and the Proxy Form are enclosed in this Circular.
A member entitled to attend and vote at the EGM is entitled to appoint a proxy or proxies to attend and to vote for him/her or on his/her behalf. In such event, the completed and signed Proxy Form must be deposited at the office of Icon’s Share Registrar at Boardroom Share Registrars Sdn Bhd at 11th Floor, Menara Symphony, No. 5, Jalan Professor Khoo Kay Kim, Seksyen 13, 46200 Petaling Jaya, Selangor Darul Ehsan, or alternatively, can be submitted via Boardroom Smart Investor Portal at www.boardroomlimited.my not less than 48 hours before the time set for holding the EGM or at any adjournment thereof. The
THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION.
If you are in any doubt as to the course of action to be taken, you should consult your stockbroker, bank manager, solicitor, accountant or other professional advisers immediately.
Bursa Malaysia Securities Berhad takes no responsibility for the contents of this Circular, valuation certificate and report, if any, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Circular.
ICON OFFSHORE BERHAD Reg. No. 201201011310 (984830-D)
(Incorporated in Malaysia) PART A
CIRCULAR TO SHAREHOLDERS IN RELATION TO THE
(I) PROPOSED ACQUISITION BY ICON EXPLORER (L) INC, A WHOLLY-OWNED SUBSIDIARY OF ICON FLEET SDN BHD (“ICON FLEET”) WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF ICON OFFSHORE BERHAD (“ICON”), OF THE “PERISAI PACIFIC 101” RIG (AS DEFINED HEREIN), AN ASSET MORTGAGED TO OVERSEA- CHINESE BANKING CORPORATION LIMITED, LABUAN BRANCH (“OCBC LABUAN”) AND OVERSEA-CHINESE BANKING CORPORATION LIMITED, SINGAPORE (“OCBC SINGAPORE”) FROM PERISAI PACIFIC 101 (L) INC (“PP101”), A WHOLLY-OWNED SUBSIDIARY OF PERISAI DRILLING HOLDINGS SDN BHD (“PDHSB”) WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF PERISAI PETROLEUM TEKNOLOGI BHD. (“PPTB”) FOR THE MOA SALE PRICE (AS DEFINED HEREIN) (“PROPOSED RIG ACQUISITION”)
(II) PROPOSED ACQUISITION BY ICON FLEET, A WHOLLY-OWNED SUBSIDIARY OF ICON, OF 51,000 ORDINARY SHARES IN PERISAI OFFSHORE SDN BHD (“POSB”) REPRESENTING 51% OF THE ISSUED SHARE CAPITAL OF POSB FROM PPTB FOR A TOTAL CONSIDERATION OF RM1,058,122.50 EQUIVALENT TO USD255,000.00 (“PROPOSED SHARE ACQUISITION”)
(III) PROPOSED ACQUISITION BY AND ASSIGNMENT TO OMNI VENTURES SDN BHD, A WHOLLY-OWNED SUBSIDIARY OF ICON FLEET WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF ICON, OF THE ASSIGNED INTELLECTUAL PROPERTY (AS DEFINED HEREIN) FROM PERISAI DRILLING SDN BHD (“PDSB”), A WHOLLY- OWNED SUBSIDIARY OF PDHSB WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF PPTB FOR A PURCHASE CONSIDERATION OF RM2,074,750.00 EQUIVALENT TO USD500,000.00 (“PROPOSED ACQUISITION AND ASSIGNMENT OF IP”)
(THE PROPOSED RIG ACQUISITION, THE PROPOSED SHARE ACQUISITION AND THE PROPOSED ACQUISITION AND ASSIGNMENT OF IP ARE COLLECTIVELY REFERRED TO AS, “PROPOSED ACQUISITIONS”)
(IV) PROPOSED VARIATION OF THE UTILISATION OF PROCEEDS RAISED FROM THE RIGHTS ISSUE OF SHARES WITH WARRANTS (“PROPOSED VARIATION”)
(V) PROPOSED DIVERSIFICATION OF THE EXISTING PRINCIPAL ACTIVITIES OF ICON AND ITS SUBSIDIARIES TO INCLUDE OFFSHORE DRILLING BUSINESS ARISING (AS DEFINED HEREIN) FROM THE PROPOSED ACQUISTIONS (“PROPOSED DIVERSIFICATION”)
(THE PROPOSED ACQUISITIONS, THE PROPOSED VARIATION AND THE PROPOSED DIVERSIFICATION ARE COLLECTIVELY REFERRED TO AS, “PROPOSALS”)
PART B
PROPOSAL TO MAKE AN OFFER ON THE EMPLOYEES’ SHARE OPTION SCHEME AND EMPLOYEES’ SHARE GRANT PLAN TO THE MANAGING DIRECTOR OF ICON
AND
NOTICE OF EXTRAORDINARY GENERAL MEETING Principal Adviser for Part A
Registration No. 197401003530 (20657-W)
The Notice of Extraordinary General Meeting (“EGM”) and the Proxy Form are enclosed in this Circular.
A member entitled to attend and vote at the EGM is entitled to appoint a proxy or proxies to attend and to vote for him/her or on his/her behalf. In such event, the completed and signed Proxy Form must be deposited at the office of Icon’s Share Registrar at Boardroom Share Registrars Sdn Bhd at 11th Floor, Menara Symphony, No. 5, Jalan Professor Khoo Kay Kim, Seksyen 13, 46200 Petaling Jaya, Selangor Darul Ehsan, or alternatively, can be submitted via Boardroom Smart Investor Portal at www.boardroomlimited.my not less than 48 hours before the time set for holding the EGM or at any adjournment thereof. The lodging of the Proxy Form will not preclude you from attending, speaking and voting in person at the EGM should you subsequently decide to do so.
THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION.
If you are in any doubt as to the course of action to be taken, you should consult your stockbroker, bank manager, solicitor, accountant or other professional advisers immediately.
Bursa Malaysia Securities Berhad takes no responsibility for the contents of this Circular, valuation certificate and report, if any, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Circular.
ICON OFFSHORE BERHAD Reg. No. 201201011310 (984830-D)
(Incorporated in Malaysia) PART A
CIRCULAR TO SHAREHOLDERS IN RELATION TO THE
(I) PROPOSED ACQUISITION BY ICON EXPLORER (L) INC, A WHOLLY-OWNED SUBSIDIARY OF ICON FLEET SDN BHD (“ICON FLEET”) WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF ICON OFFSHORE BERHAD (“ICON”), OF THE “PERISAI PACIFIC 101” RIG (AS DEFINED HEREIN), AN ASSET MORTGAGED TO OVERSEA- CHINESE BANKING CORPORATION LIMITED, LABUAN BRANCH (“OCBC LABUAN”) AND OVERSEA-CHINESE BANKING CORPORATION LIMITED, SINGAPORE (“OCBC SINGAPORE”) FROM PERISAI PACIFIC 101 (L) INC (“PP101”), A WHOLLY-OWNED SUBSIDIARY OF PERISAI DRILLING HOLDINGS SDN BHD (“PDHSB”) WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF PERISAI PETROLEUM TEKNOLOGI BHD. (“PPTB”) FOR THE MOA SALE PRICE (AS DEFINED HEREIN) (“PROPOSED RIG ACQUISITION”)
(II) PROPOSED ACQUISITION BY ICON FLEET, A WHOLLY-OWNED SUBSIDIARY OF ICON, OF 51,000 ORDINARY SHARES IN PERISAI OFFSHORE SDN BHD (“POSB”) REPRESENTING 51% OF THE ISSUED SHARE CAPITAL OF POSB FROM PPTB FOR A TOTAL CONSIDERATION OF RM1,058,122.50 EQUIVALENT TO USD255,000.00 (“PROPOSED SHARE ACQUISITION”)
(III) PROPOSED ACQUISITION BY AND ASSIGNMENT TO OMNI VENTURES SDN BHD, A WHOLLY-OWNED SUBSIDIARY OF ICON FLEET WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF ICON, OF THE ASSIGNED INTELLECTUAL PROPERTY (AS DEFINED HEREIN) FROM PERISAI DRILLING SDN BHD (“PDSB”), A WHOLLY- OWNED SUBSIDIARY OF PDHSB WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF PPTB FOR A PURCHASE CONSIDERATION OF RM2,074,750.00 EQUIVALENT TO USD500,000.00 (“PROPOSED ACQUISITION AND ASSIGNMENT OF IP”)
(THE PROPOSED RIG ACQUISITION, THE PROPOSED SHARE ACQUISITION AND THE PROPOSED ACQUISITION AND ASSIGNMENT OF IP ARE COLLECTIVELY REFERRED TO AS, “PROPOSED ACQUISITIONS”)
(IV) PROPOSED VARIATION OF THE UTILISATION OF PROCEEDS RAISED FROM THE RIGHTS ISSUE OF SHARES WITH WARRANTS (“PROPOSED VARIATION”)
(V) PROPOSED DIVERSIFICATION OF THE EXISTING PRINCIPAL ACTIVITIES OF ICON AND ITS SUBSIDIARIES TO INCLUDE OFFSHORE DRILLING BUSINESS ARISING (AS DEFINED HEREIN) FROM THE PROPOSED ACQUISTIONS (“PROPOSED DIVERSIFICATION”)
(THE PROPOSED ACQUISITIONS, THE PROPOSED VARIATION AND THE PROPOSED DIVERSIFICATION ARE COLLECTIVELY REFERRED TO AS, “PROPOSALS”)
PART B
PROPOSAL TO MAKE AN OFFER ON THE EMPLOYEES’ SHARE OPTION SCHEME AND EMPLOYEES’ SHARE GRANT PLAN TO THE MANAGING DIRECTOR OF ICON
AND
NOTICE OF EXTRAORDINARY GENERAL MEETING Principal Adviser for Part A
Registration No. 197401003530 (20657-W)
The Notice of Extraordinary General Meeting (“EGM”) and the Proxy Form are enclosed in this Circular.
A member entitled to attend and vote at the EGM is entitled to appoint a proxy or proxies to attend and to vote for him/her or on his/her behalf. In such event, the completed and signed Proxy Form must be deposited at the office of Icon’s Share Registrar at Boardroom Share Registrars Sdn Bhd at 11th Floor, Menara Symphony, No. 5, Jalan Professor Khoo Kay Kim, Seksyen 13, 46200 Petaling Jaya, Selangor Darul Ehsan, or alternatively, can be submitted via Boardroom Smart Investor Portal at
THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION.
If you are in any doubt as to the course of action to be taken, you should consult your stockbroker, bank manager, solicitor, accountant or other professional advisers immediately.
Bursa Malaysia Securities Berhad takes no responsibility for the contents of this Circular, valuation certificate and report, if any, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Circular.
ICON OFFSHORE BERHAD Reg. No. 201201011310 (984830-D)
(Incorporated in Malaysia) PART A
CIRCULAR TO SHAREHOLDERS IN RELATION TO THE
(I) PROPOSED ACQUISITION BY ICON EXPLORER (L) INC, A WHOLLY-OWNED SUBSIDIARY OF ICON FLEET SDN BHD (“ICON FLEET”) WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF ICON OFFSHORE BERHAD (“ICON”), OF THE “PERISAI PACIFIC 101” RIG (AS DEFINED HEREIN), AN ASSET MORTGAGED TO OVERSEA- CHINESE BANKING CORPORATION LIMITED, LABUAN BRANCH (“OCBC LABUAN”) AND OVERSEA-CHINESE BANKING CORPORATION LIMITED, SINGAPORE (“OCBC SINGAPORE”) FROM PERISAI PACIFIC 101 (L) INC (“PP101”), A WHOLLY-OWNED SUBSIDIARY OF PERISAI DRILLING HOLDINGS SDN BHD (“PDHSB”) WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF PERISAI PETROLEUM TEKNOLOGI BHD. (“PPTB”) FOR THE MOA SALE PRICE (AS DEFINED HEREIN) (“PROPOSED RIG ACQUISITION”)
(II) PROPOSED ACQUISITION BY ICON FLEET, A WHOLLY-OWNED SUBSIDIARY OF ICON, OF 51,000 ORDINARY SHARES IN PERISAI OFFSHORE SDN BHD (“POSB”) REPRESENTING 51% OF THE ISSUED SHARE CAPITAL OF POSB FROM PPTB FOR A TOTAL CONSIDERATION OF RM1,058,122.50 EQUIVALENT TO USD255,000.00 (“PROPOSED SHARE ACQUISITION”)
(III) PROPOSED ACQUISITION BY AND ASSIGNMENT TO OMNI VENTURES SDN BHD, A WHOLLY-OWNED SUBSIDIARY OF ICON FLEET WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF ICON, OF THE ASSIGNED INTELLECTUAL PROPERTY (AS DEFINED HEREIN) FROM PERISAI DRILLING SDN BHD (“PDSB”), A WHOLLY- OWNED SUBSIDIARY OF PDHSB WHICH IN TURN IS A WHOLLY-OWNED SUBSIDIARY OF PPTB FOR A PURCHASE CONSIDERATION OF RM2,074,750.00 EQUIVALENT TO USD500,000.00 (“PROPOSED ACQUISITION AND ASSIGNMENT OF IP”)
(THE PROPOSED RIG ACQUISITION, THE PROPOSED SHARE ACQUISITION AND THE PROPOSED ACQUISITION AND ASSIGNMENT OF IP ARE COLLECTIVELY REFERRED TO AS, “PROPOSED ACQUISITIONS”)
(IV) PROPOSED VARIATION OF THE UTILISATION OF PROCEEDS RAISED FROM THE RIGHTS ISSUE OF SHARES WITH WARRANTS (“PROPOSED VARIATION”)
(V) PROPOSED DIVERSIFICATION OF THE EXISTING PRINCIPAL ACTIVITIES OF ICON AND ITS SUBSIDIARIES TO INCLUDE OFFSHORE DRILLING BUSINESS ARISING (AS DEFINED HEREIN) FROM THE PROPOSED ACQUISTIONS (“PROPOSED DIVERSIFICATION”)
(THE PROPOSED ACQUISITIONS, THE PROPOSED VARIATION AND THE PROPOSED DIVERSIFICATION ARE COLLECTIVELY REFERRED TO AS, “PROPOSALS”)
PART B
PROPOSAL TO MAKE AN OFFER ON THE EMPLOYEES’ SHARE OPTION SCHEME AND EMPLOYEES’ SHARE GRANT PLAN TO THE MANAGING DIRECTOR OF ICON
AND
NOTICE OF EXTRAORDINARY GENERAL MEETING Principal Adviser for Part A
Registration No. 197401003530 (20657-W)
The Notice of Extraordinary General Meeting (“EGM”) and the Proxy Form are enclosed in this Circular.
A member entitled to attend and vote at the EGM is entitled to appoint a proxy or proxies to attend and to vote for him/her or on his/her behalf. In such event, the completed and signed Proxy Form must be deposited at the office of Icon’s Share Registrar at Boardroom Share Registrars Sdn Bhd at 11th Floor, Menara Symphony, No. 5, Jalan Professor Khoo Kay Kim, Seksyen 13,
THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION.
If you are in any doubt as to the course of action to be taken, you should consult your stockbroker, bank manager, solicitor, accountant or other professional advisers immediately.
Bursa Malaysia Securities Berhad takes no responsibility for the contents of this Circular, valuation certificate and report, if any, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Circular.
PART A
LETTER TO OUR SHAREHOLDERS IN RELATION TO THE PROPOSALS
DEFINITIONS
In this Circular, unless otherwise indicated, the following words and abbreviations shall have the following meanings:
Agreed Conversion
Rate : Conversion rate of USD1.00:RM4.1495 (being the middle rate quoted by Bank Negara Malaysia at 5.00 p.m. on 1 October 2020) in relation to the SSA and the Deed of Purchase & Assignment
Assigned Intellectual
Property : The System and all the intellectual property rights to the System Assignee : Omni Ventures Sdn Bhd, a wholly-owned subsidiary of Icon Fleet
nominated for the purchase and assignment of the Assigned Intellectual Property
Board : Board of Directors of Icon
Bursa Securities : Bursa Malaysia Securities Berhad
CA : Companies Act 2016
CAPEX : Capital expenditure
Circular : This circular dated 30 November 2020 to the shareholders of Icon in relation to the Proposals
COVID-19 : Coronavirus Disease 2019 Deed of Purchase &
Assignment : Deed of purchase and assignment of intellectual property dated 2 October 2020 entered into between Icon Fleet, PDSB (as Assignor), PDHSB and PPTB (collectively as warrantors) for the purchase and assignment of the Assigned Intellectual Property by the Assignee at the IP Purchase Consideration in relation to the Proposed Acquisition and Assignment of IP
E&P : Exploration and production EGM : Extraordinary general meeting
EPS/(LPS) : Earnings per share or loss per share, as the case may be
EUR : Euro
FPE : Financial period ended
FYE : Financial year ended or ending, as the case may be Icon or Company : Icon Offshore Berhad
Icon Fleet : Icon Fleet Sdn Bhd, a wholly-owned subsidiary of Icon Icon Group or Group : Collectively, Icon and its subsidiaries
Icon Share(s) or
Share(s) : Ordinary shares in Icon
DEFINITIONS
IMR : Frost & Sullivan GIC Malaysia Sdn Bhd, the independent market researcher consultant
IMR Report : The Overview and Outlook of the Global, Regional and Malaysia Oil &
Gas Industry and Rigs Market Outlook Report dated 30 October 2020 prepared and issued by the IMR
IP Purchase
Consideration : Purchase consideration of RM2,074,750.00 equivalent to USD500,000.00 based on the Agreed Conversion Rate in relation to the Proposed Acquisition and Assignment of IP
KAF IB or Principal
Adviser : KAF Investment Bank Berhad
LCA : Labuan Companies Act 1990
Listing Requirements : Main Market Listing Requirements of Bursa Securities
LPD : 26 November 2020, being the latest practicable date prior to the date of printing of this Circular
MCO : Movement Control Order
MD : Managing Director
MOA : Memorandum of agreement dated 2 October 2020 entered into between Icon Fleet and/or its nominee (as purchaser), PP101 (as Seller), (the Mortgagees acting as attorney of PP101) and PPTB (as warrantor) for the purchase of the Rig by the MOA Purchaser at the MOA Sale Price in relation to the Proposed Rig Acquisition
MOA Purchaser : Icon Explorer (L) Inc, a wholly-owned subsidiary of Icon Fleet nominated for the purchase of the Rig
MOA Sale Price : Sale price of USD44,245,000.00 which has been reduced to the adjusted sale price of USD41,790,000.00, subject to the adjustments and terms of payment as stipulated in the MOA, in relation to the Proposed Rig Acquisition
Mortgagees : Collectively, OCBC Labuan and OCBC Singapore
NA : Net assets
NBV : Net book value
O&G : Oil and gas
OCBC Labuan : Oversea-Chinese Banking Corporation Limited, Labuan Branch, a branch of OCBC Singapore
OCBC Singapore : Oversea-Chinese Banking Corporation Limited, Singapore Offshore Drilling
Business : Owning and operating the Rig, and running the offshore drilling business as a stand-alone model i.e. chartering it out for drilling, exploration appraisals and development
OSV : Offshore support vessels
DEFINITIONS
PAT/(LAT) : Profit after tax or loss after tax, as the case may be
PBT : Profit before tax
PCSB : Petronas Carigali Sdn Bhd
PDHSB : Perisai Drilling Holdings Sdn Bhd, a wholly-owned subsidiary of PPTB PDSB or Assignor : Perisai Drilling Sdn Bhd, a wholly-owned subsidiary of PDHSB which in
turn is a wholly-owned subsidiary of PPTB PETRONAS : Petroliam Nasional Berhad
POSB : Perisai Offshore Sdn Bhd, a 51%-owned subsidiary of PPTB
PP101 or Seller : Perisai Pacific 101 (L) Inc, a wholly-owned subsidiary of PDHSB which in turn is a wholly-owned subsidiary of PPTB
PPTB or Vendor : Perisai Petroleum Teknologi Bhd.
Proposals : Collectively, the Proposed Acquisitions, the Proposed Variation and the Proposed Diversification
Proposed
Acquisitions : Collectively, the Proposed Rig Acquisition, the Proposed Share Acquisition and the Proposed Acquisition and Assignment of IP
Proposed Acquisition and Assignment of IP
: Proposed acquisition by and assignment to the Assignee of the Assigned Intellectual Property from the Assignor at the IP Purchase Consideration
Proposed
Diversification : Proposed diversification of the existing principal activities of the Icon Group to include the Offshore Drilling Business arising from the Proposed Acquisitions pursuant to Paragraph 10.13 of the Listing Requirements
Proposed Rig
Acquisition : Proposed acquisition by the MOA Purchaser of the Rig, an asset mortgaged to the Mortgagees from the Seller (the Mortgagees acting as attorney of the Seller) and PPTB (as warrantor) at the MOA Sale Price Proposed Share
Acquisition : Proposed acquisition by the SSA Purchaser of the Sale Shares from the Vendor for a total consideration of RM1,058,122.50 equivalent to USD255,000.00 comprising:
(i) RM4.15 (after rounding up to the nearest Sen) equivalent to USD1.00 being the purchase consideration of the Sale Shares; and (ii) RM1,058,118.35 equivalent to USD254,999.00 being the
Shareholder’s Advance by the SSA Purchaser for the settlement of the Remaining Debt
Proposed Variation : Proposed variation of the utilisation of proceeds raised from the Rights Issue of Shares with Warrants of 2,618,060,864 new Icon Shares together with 654,515,210 free detachable warrants in Icon
DEFINITIONS
Remaining Debt : The remaining debt of up to RM1,058,118.35 equivalent to USD254,999.00 based on the Agreed Conversion Rate upon settlement by the Vendor of the debt owed by POSB to its trade creditors as stipulated in the SSA. As at the LPD, the outstanding amount to its trade creditors is RM433,683.82.
In the event the Remaining Debt is less than the Shareholder’s Advance (as a result of any settlement and/or payment by POSB and/or the Vendor to the creditors of POSB prior to the completion of the SSA and subject to the terms of the SSA), the SSA Purchaser shall, on completion of the SSA, pay the differential sum between the Remaining Debt and the Shareholder’s Advance to the Vendor as an upward adjustment of the SSA Purchase Consideration
Rights Issue of Shares
with Warrants : The renounceable rights issue of shares with warrants exercise undertaken by the Company which completed on 18 February 2020 Rig : 1 unit of jack-up drilling rig registered with the Registrar of Malaysian
Ships at Port Klang named “PERISAI PACIFIC 101” and bearing registration no. 335537, IMO no. 9662538, including but not limited to, all machinery, engines, equipment, tools, supplies, cables, pumps, furniture and fixtures, anchors, electrical, mechanical, chemical, hydraulic, real properties and improvements and other systems actually located thereon, incorporated therein or attached thereto or relating thereto together with all ancillary assets and/or spare parts or critical parts including the items and equipment identified in the MOA
RM and Sen : Ringgit Malaysia and Sen, respectively
Sale Shares : 51,000 ordinary shares in POSB representing 51% of the issued share capital of POSB
Shareholder’s
Advance : A shareholder’s advance for a sum of up to RM1,058,118.35 equivalent to USD254,999.00 based on the Agreed Conversion Rate to POSB as shareholder’s advance which shall be utilised by POSB solely towards settlement of the Remaining Debt or if the SSA Purchaser shall in its absolute discretion deem fit, such shareholder’s advance shall be paid directly to the creditor(s) of POSB
SSA : Share sale agreement dated 2 October 2020 entered into between Icon Fleet (as SSA Purchaser) and PPTB (as Vendor) for the purchase of the Sale Shares by the SSA Purchaser at the SSA Purchase Consideration in relation to the Proposed Share Acquisition
SSA Purchase
Consideration : Purchase consideration of the Sale Shares of RM4.15 (after rounding up to the nearest Sen) equivalent to USD1.00 based on the Agreed Conversion Rate, subject to any adjustment pursuant to the SSA in relation to the Proposed Share Acquisition
SSA Purchaser : Icon Fleet
DEFINITIONS
System : “QHES Management System” and such other required system(s) including all systems, manuals, policies, plans, models, methodologies, processes, standards, data, information, documents, checklists, hardware and other materials and/or properties whatsoever used and owned by the Assignor or held for the use of the Assignor in relation to the operation and maintenance of the Rig and/or the Assignor’s business and shall include any and all further improvements, enhancements and development, customisation (whether patentable or otherwise) made thereto by the Assignor
Transaction
Documents : Collectively, the MOA, the SSA and the Deed of Purchase & Assignment USD : United States Dollar
Valuation Report : The “PERISAI PACIFIC 101”/Self Elevating (Jack-Up) Drilling Unit, Jack-Up Drilling Rig Fair Market Valuation Report dated 21 August 2020 prepared and issued by the Valuers on the Rig
Valuers : Aqualis Braemar Sdn Bhd (formerly known as Braemar Technical Services (Offshore) Sdn Bhd), an independent firm appointed by the Company to value the Rig
All references to “we”, “us”, “our” and “ourselves” are to the Company and, where the context requires otherwise, the subsidiaries of the Company. All references to “you” in this Circular are to the shareholders of Icon.
Words denoting the singular number only shall include the plural and vice versa and words denoting the masculine gender shall, where applicable, include the feminine gender, neuter gender and vice versa. Reference to persons shall include a body of persons, corporate or unincorporated (including a trust), unless otherwise specified.
Any reference to a time of day shall be a reference to Malaysian time, unless otherwise stated. Any reference to any provision of a statute, rule, regulation, enactment or rule of stock exchange shall be construed as a reference to the provision of such statute, rule, regulation, enactment or rule of stock exchange as modified by any written law or amendment or re-enactment to the statute, rule, regulation, enactment or rule of stock exchange for the time being in force.
Certain statements in this Circular may be forward-looking in nature, which are subject to uncertainties and contingencies. Forward-looking statements may contain estimates and assumptions made by the Board after due enquiry, which are nevertheless subject to known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to differ materially from the anticipated results, performance or achievements expressed or implied in such forward-looking statements. In light of these and other uncertainties, the inclusion of a forward-looking statement in this Circular should not be regarded as a representation or warranty that the Company’s plans and objectives will be achieved.
CONTENTS
LETTER TO THE SHAREHOLDERS OF ICON IN RELATION TO THE PROPOSALS:
SECTION PAGE
1. INTRODUCTION 1
2. DETAILS OF THE PROPOSED ACQUISITIONS 2
3. DETAILS OF THE PROPOSED VARIATION 9
4. DETAILS OF THE PROPOSED DIVERSIFICATION 10
5. RATIONALE FOR THE PROPOSALS 12
6. INDUSTRY OUTLOOK AND PROSPECTS
13
7. RISK FACTORS 19
8. EFFECTS OF THE PROPOSALS 21
9. APPROVALS REQUIRED 22
10. INTERESTS OF DIRECTORS, MAJOR SHAREHOLDERS AND/OR PERSONS
CONNECTED WITH THEM 23
11. DIRECTORS’ STATEMENT AND RECOMMENDATION 23
12. HIGHEST PERCENTAGE RATIO 23
13. ESTIMATED TIMEFRAME FOR COMPLETION 23
14. CORPORATE PROPOSALS ANNOUNCED BUT PENDING COMPLETION 23
15. EGM 24
16. FURTHER INFORMATION 24
APPENDICES
I SALIENT TERMS OF THE MOA 25
II SALIENT TERMS OF THE SSA 31
III SALIENT TERMS OF THE DEED OF PURCHASE & ASSIGNMENT 36
IV INFORMATION ON POSB 40
V AUDITED FINANCIAL STATEMENTS OF POSB FOR THE FYE 30 JUNE 2019 44 VI THE “PERISAI PACIFIC 101”/SELF ELEVATING (JACK-UP) DRILLING UNIT, JACK-
UP DRILLING RIG FAIR MARKET VALUATION REPORT 94
VII FURTHER INFORMATION 103
NOTICE OF EGM ENCLOSED
PROXY FORM ENCLOSED
EXECUTIVE SUMMARY
All definitions used in this Executive Summary shall have the same meaning as the words and expressions provided in the “Definitions” Section and context in this Circular.
This Executive Summary highlights only the pertinent information from other parts of this Circular. You are advised to read and understand the contents of this Circular in its entirety and not to rely solely on this Executive Summary in forming a decision on the Proposals before voting at the EGM.
Key information Description
Summary of the Proposals On 2 October 2020, KAF IB had, on behalf of our Board, announced that Icon Fleet had, on even date entered into the Transaction Documents, for a total cash consideration of USD42,545,000.00 to be satisfied entirely in cash upon the terms and conditions as set out in the Transaction Documents.
In conjunction with and as a consequent of the Proposed Acquisitions, Icon also intends to seek its shareholders’ approval to:
(i) vary the utilisation of proceeds arising from the Rights Issue of Shares with Warrants previously undertaken by Icon to facilitate the Proposed Acquisitions; and
(ii) diversify the existing principal activities of our Group to include Offshore Drilling Business.
Details of the Proposed
Acquisitions (i) Proposed Rig Acquisition
The Proposed Rig Acquisition shall entail the MOA Purchaser acquiring the Rig from the Seller, (the Mortgagees acting as attorney of the Seller) and PPTB (as warrantor), for the sale price of USD44,245,000.00 which has been reduced to the adjusted sale price of USD41,790,000.00, subject to the adjustments and terms of payment as stipulated in Section 2 of Appendix I of this Circular, to be satisfied entirely in cash.
The Rig is an independent leg jack-up drilling rig which was built in 2014 by PPL Shipyard Pte Ltd, Singapore.
Please refer to Section 2.1 of this Circular for further details on the Proposed Rig Acquisition.
(ii) Proposed Share Acquisition
The Proposed Share Acquisition shall entail the SSA Purchaser acquiring the Sale Shares from the Vendor.
POSB is principally involved in the provision of offshore O&G services in the upstream oil sectors.
Please refer to Section 2.2 of this Circular for further details on the Proposed Share Acquisition.
(iii) Proposed Acquisition and Assignment of IP
The Proposed Acquisition and Assignment of IP shall entail the Assignee acquiring and accepting the assignment of the Assigned Intellectual Property from the Assignor for a purchase consideration of RM2,074,750.00 equivalent to USD500,000.00 based on the Agreed Conversion Rate, to be satisfied entirely in cash.
Please refer to Section 2.3 of this Circular for further details on the
Key information Description Basis and justification in
arriving at the respective purchase considerations
(i) Proposed Rig Acquisition
The MOA Sale Price was arrived at on a “willing-buyer willing-seller”
basis, taking into consideration the following:
(a) the fair value of the Rig as at 21 August 2020 ranging from USD54,000,000.00 to USD63,000,000.00, as appraised by the Valuers; and
(b) the earnings potential of the Rig to the Icon Group.
(ii) Proposed Share Acquisition
The SSA Purchase Consideration of POSB was arrived at on a “willing- buyer willing-seller” basis, taking into consideration the audited NA of POSB as at 30 June 2019 of RM2,225,141.00.
(iii) Proposed Acquisition and Assignment of IP
The IP Purchase Consideration of the Assigned Intellectual Property was arrived at on a “willing-buyer willing-seller” basis, taking into consideration the following:
(a) the opportunity and replacement costs of designing and developing the System as a new proprietary property of Icon;
and
(b) the viability of the System in terms of reliability, quality, safety and human resource management is proven as the System reflects the best industry practices that is good, safe, economical, environmentally sound and efficient and had been audited, approved and accepted by PCSB enabling the Rig to operate successfully throughout the contract period with PCSB since 2014.
Please refer to Sections 2.1.3, 2.2.2 and 2.3.2, respectively, of this Circular for further details on the basis and justification of arriving at the respective considerations.
Details of the Proposed
Variation Icon had on 18 February 2020 announced that it had completed the Rights Issue of Shares with Warrants on the Main Market of Bursa Securities.
Icon has successfully raised total gross proceeds of approximately RM247,209,000.00 from the Rights Issue of Shares with Warrants, to be utilised in the manner as set out in Section 4 of Icon’s Abridged Prospectus dated 23 January 2020 in relation to the Rights Issue of Shares with Warrants.
As at the LPD, our Group has utilised approximately RM196,231,000.00 from the proceeds of the Rights Issue of Shares with Warrants while the balance proceeds from the Rights Issue of Shares with Warrants stood at RM50,978,000.00.
After due deliberation and taking into consideration the Proposed Acquisitions as stipulated in Section 2 of this Circular, our Board has resolved to vary part of the utilisation of proceeds raised from the Rights Issue of Shares with Warrants to part-finance the Proposed Acquisitions.
Please refer to Section 3 of this Circular for further details on the Proposed Variation.
EXECUTIVE SUMMARY
Key information Description Details of the Proposed
Diversification Barring any unforeseen circumstances, the Proposed Acquisitions may reasonably be expected to contribute 25% or more of the net profits of our Group and/or diversion of 25% or more of the NA of our Group going forward.
As such, pursuant to Paragraph 10.13 of the Listing Requirements, the Proposed Acquisitions are expected to result in the Proposed Diversification.
Please refer to Section 4 of this Circular for further details on the Proposed Diversification.
Rationale for the Proposals (i) Proposed Acquisitions
The Proposed Acquisitions will add the Rig named “PERISAI PACIFIC 101” into our list of offshore assets and provide our Group with an opportunity to venture into the Offshore Drilling Business. Upon completion, the Proposed Acquisitions shall serve to provide our Group with an opportunity to pivot to the Offshore Drilling Business. Upon completion, the Proposed Acquisitions shall serve to provide our Group with an additional source of income from the larger segment of upstream O&G value chain.
Upon the completion of the Proposed Acquisitions, our Group can leverage on its existing assets in the form of OSV and strong relationship with the oil majors to transform Icon into an integrated services provider. We envisage that this strategy will enable us to broaden our service offerings to better serve our clients as we will be in a position to provide solutions to the clients, instead of just offering assets for their hiring. Furthermore, this will enable our Group to differentiate ourselves further relative to our peers by creating a niche and sustainable business segment.
(ii) Proposed Variation
The Proposed Variation will entail the variation of RM50,978,467.00 to the utilisation of proceeds arising from the Rights Issue of Shares and Warrants as detailed in Section 3 of this Circular. The Proposed Variation will enable and facilitate Icon to part-finance the Proposed Acquisitions.
(iii) The Proposed Diversification
The Proposed Diversification is fundamental to the implementation of the Proposed Acquisitions as our Board reasonably expects that the Proposed Acquisitions would contribute 25% or more of the net profits of our Group and/or diversion of 25% or more of the NA of our Group going forward.
Approvals required The Proposals are subject to the following approvals being obtained from the following parties:
(i) the shareholders of Icon for the Proposals in the EGM to be convened;
(ii) the relevant authorities and/or parties as stipulated in Sections 3 of Appendix I, 3 of Appendix II and 2 of Appendix III of this Circular, where applicable; and
(iii) any other relevant authorities, if required.
Key information Description
Directors’ recommendation Our Board, having considered all aspects of the Proposals, including but not limited to the terms and conditions of the Transaction Documents, rationale of the Proposals, risk factors, industry outlook and prospects and effects of the Proposals, is of the opinion that the Proposals are in the best interest of the Company.
Accordingly, our Board recommends that you vote in favour of the resolutions pertaining to the Proposals at the forthcoming EGM.
ICON OFFSHORE BERHAD Reg. No. 201201011310 (984830-D)
(Incorporated in Malaysia)
Registered Office:
Level 7, Menara Milenium Jalan Damanlela
Pusat Bandar Damansara Damansara Heights 50490 Kuala Lumpur Wilayah Persekutuan 30 November 2020
Board of Directors:
Raja Tan Sri Dato’ Seri Arshad Bin
Raja Tun Uda (Chairman and Non-Independent Non-Executive Director) Dato’ Sri Hadian Bin Hashim (Managing Director)
Syed Yasir Arafat Bin Syed Abd Kadir (Non-Independent Non-Executive Director) Datuk Wira Azhar Bin Abdul Hamid (Senior Independent Non-Executive Director) Edwanee Cheah Bin Abdullah (Independent Non-Executive Director) Madeline Lee May Ming (Independent Non-Executive Director) Farina Binti Farikhullah Khan (Independent Non-Executive Director) Datuk Abdullah Bin Karim (Independent Non-Executive Director) To: The Shareholders of Icon
Dear Sir/Madam,
(I) PROPOSED RIG ACQUISITION (II) PROPOSED SHARE ACQUISITION
(III) PROPOSED ACQUISITION AND ASSIGNMENT OF IP (IV) PROPOSED VARIATION
(V) PROPOSED DIVERSIFICATION (“PROPOSALS”)
1. INTRODUCTION
On 2 October 2020, KAF IB had, on behalf of our Board, announced that Icon Fleet had, on even date entered into the Transaction Documents, for a total cash consideration of USD42,545,000.00 to be satisfied entirely in cash upon the terms and conditions as set out in the Transaction Documents.
In conjunction with and as a consequent of the Proposed Acquisitions, Icon also intends to seek its shareholders’ approval to:
(i) vary the utilisation of proceeds arising from the Rights Issue of Shares with Warrants previously undertaken by Icon to facilitate the Proposed Acquisitions; and
(ii) diversify the existing principal activities of our Group to include Offshore Drilling Business.
YOUR APPROVAL FOR THE RESOLUTIONS PERTAINING TO THE PROPOSALS TO BE TABLED AT THE FORTHCOMING EGM. THE NOTICE OF EGM TOGETHER WITH THE PROXY FORM ARE ENCLOSED TOGETHER WITH THIS CIRCULAR.
YOU ARE ADVISED TO READ AND CONSIDER CAREFULLY THE CONTENTS OF THIS CIRCULAR TOGETHER WITH THE APPENDICES CONTAINED HEREIN BEFORE VOTING ON THE RESOLUTIONS PERTAINING TO THE PROPOSALS TO BE TABLED AT THE FORTHCOMING EGM.
2. DETAILS OF THE PROPOSED ACQUISITIONS 2.1 Proposed Rig Acquisition
2.1.1 Background information on the Proposed Rig Acquisition
The Proposed Rig Acquisition shall entail the MOA Purchaser acquiring the Rig from the Seller, (the Mortgagees acting as attorney of the Seller) and PPTB (as warrantor) for the sale price of USD44,245,000.00 which has been reduced to the adjusted sale price of USD41,790,000.00, subject to the adjustments and terms of payment as stipulated in Section 2 of Appendix I of this Circular. The Proposed Rig Acquisition is subject to the terms and conditions of the MOA. Please refer to Appendix I of this Circular for the salient terms of the MOA.
The adjusted sale price of USD41,790,000.00 shall be paid in cash in the following manner in accordance with the MOA:
Terms of settlement Timing USD
(i) Deposit The refundable deposit has been paid
as at the date of the MOA 2,250,000.00 (ii) Balance of the
adjusted sale price Payable on the MOA Closing (as
defined herein) 39,540,000.00
Total 41,790,000.00
2.1.2 Background information on the Rig
Design : Pacific Class 400
IMO no. : 9662538
Type : Jack-up rig – independent leg jack up Year built : 2014 – PPL Shipyard Pte Ltd, Singapore Port registry : Port Kelang
Classification : ABS
Class notation : +A1 self-elevating drilling unit Dead weight tonnage : 3,400 metric ton
Gross register tonnage : 10,501 metric ton Living quarters : 150 pax
Registered owner : PP101
Encumbrances : Save as disclosed below, there are no other encumbrances on the Rig:
(i) the Mortgages (as defined in Section 2(iv) of Appendix I of this Circular) and the Securities (as defined in Section 2(iv) of Appendix I of this Circular) registered by the Mortgagees; and
(ii) the Third Mortgage (as defined in Section 2(v) of Appendix I of this Circular) registered by Icon Fleet, on the Rig with the Registrar of Malaysian Ships at Port Klang
NBV : USD110,916,282.00 based on the audited FYE 30 June 2019
2.1.3 Basis and justification of arriving at the MOA Sale Price
The MOA Sale Price was arrived at on a “willing-buyer willing-seller” basis, taking into consideration the following:
(i) the fair value of the Rig ranging from USD54,000,000.00 to USD63,000,000.00*, as appraised by the Valuers; and
(ii) the earnings potential of the Rig to the Icon Group.
Note:
* Salient features of the Valuation Report are as follows:
Date of the Valuation Report : 21 August 2020 Material date of valuation : 31 July 2020
Valuation methodology : The valuation methodology considers a broad range of factors and market indicators as relevant to the drilling rig as follows:
(i) The oil price - The primary driver of investment and activity in the O&G sector and significantly influences the demand for drilling contracts.
(ii) Utilisation and day rates - Total jackup utilisation at 68% flat from 67% in May 2020 and down from 77%
in January 2020.
(iii) Capital markets - Less O&G funding via capital market. This has caused and will continue to cause significant downward pressure on O&G assets pricing.
(iv) Recent events or precedent transaction.
the valuation;
(ii) is based on rig design, specification, builder and age and the available technical information for the rig as provided;
(iii) does not consider the value of any current or potential drilling contracts;
(iv) considers the unit is charter free;
(v) considers the unit is properly maintained and in a warm stacked state; and
(vi) is provided on the basis that there exists a willing- buyer and a willing-seller.
2.2 Proposed Share Acquisition
2.2.1 Background information on the Proposed Share Acquisition
The Proposed Share Acquisition shall entail the SSA Purchaser acquiring the Sale Shares from the Vendor. In consideration of the SSA Purchaser agreeing to grant the Shareholder’s Advance to POSB towards the settlement of the Remaining Debt, the purchase consideration of the Sale Shares shall be RM4.15 (after rounding up to the nearest Sen) equivalent to USD1.00 based on the Agreed Conversion Rate, subject to any adjustment pursuant to the SSA, to be satisfied entirely in cash. The aggregate amount of the SSA Purchase Consideration and the Shareholder’s Advance shall be RM1,058,122.50 equivalent to USD255,000.00 based on the Agreed Conversion Rate.
Upon completion of the Proposed Share Acquisition, Icon will hold 51% indirect equity interest in POSB.
The Proposed Share Acquisition is subject to the terms and conditions of the SSA. Please refer to Appendix II of this Circular for the salient terms of the SSA.
2.2.2 Basis and justification of arriving at the total consideration in relation to the Proposed Share Acquisition
The total consideration of RM1,058,122.50 equivalent to USD255,000.00 in relation to the Proposed Share Acquisition, was arrived at on a “willing-buyer willing-seller” basis, taking into consideration the audited NA of POSB as at 30 June 2019 of RM2,225,141.00.
2.3 Proposed Acquisition and Assignment of IP
2.3.1 Background information on the Proposed Acquisition and Assignment of IP
The Proposed Acquisition and Assignment of IP shall entail the Assignee acquiring and accepting the assignment of the Assigned Intellectual Property from the Assignor for a purchase consideration of RM2,074,750.00 equivalent to USD500,000.00 based on the Agreed Conversion Rate, to be satisfied entirely in cash. The main items under the Assigned Intellectual Property are information technology assets (hardware and software), manuals, policies, plans, models, methodologies, processes, standards, data, information, documents and checklists. Only information technology assets (hardware and software) are accounted for in the books of Assignor, of which the NBV as at 30 June 2019 is RM16,488.00.
The Proposed Acquisition and Assignment of IP is subject to the terms and conditions of the Deed of Purchase & Assignment. Please refer to Appendix III of this Circular for the salient terms of the Deed of Purchase & Assignment.
2.3.2 Basis and justification of arriving at the IP Purchase Consideration
The IP Purchase Consideration of the Assigned Intellectual Property* was arrived at on a
“willing-buyer willing-seller” basis, taking into consideration the following:
(i) the opportunity and replacement costs of designing and developing the System as a new proprietary property of Icon; and
(ii) the viability of the System in terms of reliability, quality, safety and human resource management is proven as the System reflects the best industry practices that is good, safe, economical, environmentally sound and efficient and had been audited, approved and accepted by PCSB enabling the Rig to operate successfully throughout the contract period with PCSB since 2014.
Note:
* No valuation was performed in determining the market value of the Assigned Intellectual Property.
2.4 Source of funding
The Proposed Acquisitions will be funded via proceeds raised from the Rights Issue of Shares with Warrants and new borrowings to be undertaken by the Company. The exact mix of the proceeds raised from the Rights Issue of Shares with Warrants and new borrowings will be determined at a later stage, after taking into consideration our Group’s gearing level, interest costs and internal cash requirements for its business operations.
2.5 Liabilities to be assumed by the Company
Save for the matters as set out in Sections 6(e) of Appendix I, 6(i)(2) of Appendix II and 5(i)(2) of Appendix III of this Circular, there are no liabilities, including contingent liabilities and guarantees, to be assumed by the Company pursuant to the Proposed Acquisitions.
2.6 Additional financial commitment required
An additional funding of up to USD2,600,000.00 is required to reactivate the Rig in order for the Rig to be fully operational and ready to take on new contract(s) since the Rig is currently in laid up and certain components are due or overdue for periodic repairs or replacements. The reactivation of the Rig comprises capital expenditure i.e. main engines major overhaul, painting and piping of the Rig and purchase of new parts. As at the LPD, there is no active contract with any O&G operator to charter the Rig. Such financial commitment is expected to be funded via proceeds from the Rights Issue of Shares with Warrants and/or new borrowings to be undertaken by the Company. The exact mix of the proceeds raised from the Rights Issue of Shares with Warrants and new borrowings will be determined at a later stage. The expected timeframe for completion of the reactivation of the Rig is by the first quarter of 2021.
Save for operational expenses to be incurred, there is no additional financial commitment required in putting POSB and the Assigned Intellectual Property on stream.
2.7 Background information on parties involved in the Proposals 2.7.1 PPTB
PPTB is a public company incorporated in Malaysia under the Companies Act 1965 and is deemed registered under the CA on 30 October 2003. PPTB is principally involved in investment holding and the provision of management, administrative and financial support services to its subsidiaries.
Shareholding
Name of Director Direct Indirect
No. of shares % No. of shares % Dato’ Yogesvaran a/l
T.Arianayagam 3,006,207 0.24 - -
Chan Feoi Chun 500,000 0.04 - -
Datuk Zainol Izzet Bin Mohamed
Ishak 29,473,900 2.34 - -
Dato’ Anwarrudin Bin Ahamad
Osman - - - -
As at the LPD, the substantial shareholders of PPTB and their respective direct and indirect shareholdings in PPTB are as follows:
Shareholding
Name of Shareholder Direct Indirect
No. of shares % No. of shares %
Ezra Holdings Limited - - (1)281,344,2501 22.32
EMAS Offshore Limited 144,661,250 11.48 - -
HCM Logistics Limited 136,683,000 10.84 - -
Note:
(1) Deemed interested by virtue of Section 8 of the CA, held through EMAS Offshore Limited and HCM Logistics Limited.
2.7.2 PDHSB
PDHSB is a private limited company incorporated in Malaysia under the Companies Act 1965 and is deemed registered under the CA on 18 July 2013. The principal activity of PDHSB is that of investment holding.
As at the LPD, the directors of PDHSB and their respective direct and indirect shareholdings in PDHSB are as follows:
Shareholding
Name of Director Direct Indirect
No. of shares % No. of shares % Datuk Zainol Izzet bin Mohamed
Ishak - - - -
Dato’ Anwarrudin bin Ahamad
Osman - - - -
As at the LPD, the sole shareholder of PDHSB and its direct and indirect shareholding in PDHSB is as follows:
Shareholding
Name of Shareholder Direct Indirect
No. of shares % No. of shares %
PPTB 100,000 100 - -
2.7.3 PDSB
PDSB is a private limited company incorporated in Malaysia under the Companies Act 1965 and is deemed registered under the CA on 5 May 2006. PDSB is principally engaged in the operations and maintenance for jack-up rigs.
As at the LPD, the directors of PDSB and their respective direct and indirect shareholdings in PDSB are as follows:
Shareholding
Name of Director Direct Indirect
No. of shares % No. of shares % Datuk Zainol Izzet Bin Mohamed
Ishak - - - -
Dato’ Anwarrudin Bin Ahamad
Osman - - - -
As at the LPD, the sole shareholder of PDSB and its direct and indirect shareholding in PDSB is as follows:
Shareholding
Name of Shareholder Direct Indirect
No. of shares % No. of shares %
PDHSB 828,000 100 - -
2.7.4 PP101
PP101 is a Labuan company incorporated in Malaysia under the LCA on 15 October 2004.
The principal activity of PP101 is chartering of offshore assets which are primarily for O&G industry.
As at the LPD, the sole director of PP101 and its direct and indirect shareholding in PP101 is as follows:
Shareholding
Name of Director Direct Indirect
No. of shares % No. of shares % Datuk Zainol Izzet Bin Mohamed
Ishak - - - -
As at the LPD, the sole shareholder of PP101 and its direct and indirect shareholding in PP101 is as follows:
Shareholding
Name of Shareholder Direct Indirect
No. of shares % No. of shares %
PDHSB 1,000 100 - -
2.7.5 OCBC Labuan
OCBC Labuan is registered as a foreign Labuan company under the LCA, and is a branch of OCBC Singapore. OCBC Labuan offers product and services such as credit facilities (conventional and Islamic), deposits, remittances and funds transfer.
(Source: Association of Labuan Banks, Malaysia at www.alb-labuan.com) 2.7.6 OCBC Singapore
OCBC Singapore is the longest established Singapore bank, formed in 1932 from the merger of 3 local banks, the oldest of which was founded in 1912. It is now the second largest financial services group in Southeast Asia by assets and one of the world’s most highly-rated banks, with an Aa1 rating from Moody’s. Recognised for its financial strength and stability, OCBC Singapore is consistently ranked among the World’s Top 50 Safest Banks by Global Finance and has been named Best Managed Bank in Singapore by The Asian Banker.
OCBC Singapore and its subsidiaries offer a broad array of commercial banking, specialist financial and wealth management services, ranging from consumer, corporate, investment, private and transaction banking to treasury, insurance, asset management and stockbroking services.
OCBC Singapore’s key markets are Singapore, Malaysia, Indonesia and Greater China. It has more than 540 branches and representative offices in 19 countries and regions. These include over 280 branches and offices in Indonesia under subsidiary Bank OCBC NISP, and over 80 branches and offices in Mainland China, Hong Kong SAR and Macau SAR under OCBC Wing Hang. OCBC Singapore’s private banking services are provided by its wholly- owned subsidiary Bank of Singapore, which operates on a unique open-architecture product platform to source for the best-in-class products to meet its clients’ goals.
OCBC Singapore’s insurance subsidiary, Great Eastern Holdings, is the oldest and most established life insurance group in Singapore and Malaysia. Its asset management subsidiary, Lion Global Investors, is one of the largest private sector asset management companies in Southeast Asia.
(Source: OCBC Singapore’s annual report 2019)
9
9
ILS OF THE PROPOSED VARIATION ctober 2020, KAF IB had, on behalf of our Board, announced that Icon also intends to seek its shareholders’ approval to vary the utilisation of ds arising from the Rights Issue of Shares with Warrants previously undertaken by Icon to facilitate the Proposed Acquisitions. ad on 18 February 2020 announced that it had completed the Rights Issue of Shares with Warrants on the Main Market of Bursa Securities. Icon uccessfully raised total gross proceeds of approximately RM247,209,000.00 from the Rights Issue of Shares with Warrants, to be utilised in the r as set out in Section 4 of Icon’s Abridged Prospectus dated 23 January 2020 in relation to the Rights Issue of Shares with Warrants. the LPD, the Icon Group has utilised approximately RM196,231,000.00 from the proceeds of the Rights Issue of Shares with Warrants while the ce proceeds from the Rights Issue of Shares with Warrants stood at RM50,978,000.00. e deliberation and taking into consideration the Proposed Acquisitions as stipulated in Section 2 of this Circular, the Board has resolved to vary f the utilisation of proceeds raised from the Rights Issue of Shares with Warrants to part-finance the Proposed Acquisitions, as detailed below: seProposed utilisationActual utilisation
Balance of proceeds as at the LPD Variation to the balance of proceedsVariation Revised utilisation of proceeds after the Proposed Variation
Expected time frame for utilisation of proceeds (from the date of receipt) (RM’000) (RM’000) (RM’000) (RM’000) (%)(RM’000) (Month) t repayment of bank rowings of the Icon Group 170,000170,000- - - - 1 al working capital of the roup 8,7598,759- - - - 24 ital expenditure of the Icon (1)59,260 8,28250,978 (50,978)100%50,978 24 imated expenses relating to porate proposals and debt cturing
9,190 9,190- - - - 3 sed Variation t-finance the Proposed tions - - 50,978 50,978 100%50,978 12 247,209196,23150,978 (2) 50,978100%50,978
Notes:
(1) The future capital expenditure for the OSV business will be funded from the internally generated funds of the OSV business.
(2) As at the LPD, we have yet to determine the actual breakdown to be utilised to part-finance the Proposed Acquisitions.
4. DETAILS OF THE PROPOSED DIVERSIFICATION
Barring any unforeseen circumstances, the Proposed Acquisitions may reasonably be expected to contribute 25% or more of the net profits of our Group and/or diversion of 25% or more of the NA of our Group going forward.
Pursuant to Paragraph 10.13 of the Listing Requirements, the Proposed Acquisitions are expected to result in the Proposed Diversification which requires shareholders’ approval.
Accordingly, our Company wishes to seek your approval at the forthcoming EGM for the Proposed Diversification. The Offshore Drilling Business is expected to commence upon the completion of the Proposed Acquisitions.
Notwithstanding the Proposed Diversification, our Board intends to continue with our Group’s existing principal activities in the same manner and our Board will review our Group’s business operations from time to time with the intention to further improve our Group’s financial performance.
Following the Proposed Acquisitions, our Board believes that our Group has the capacity, capabilities and resources to manage the Offshore Drilling Business, leveraging on the following factors:
(i) Dato’ Sri Hadian Bin Hashim (“Dato’ Sri Hadian”) who joined our Group as the MD on 3 September 2019, has the requisite skills, expertise and experience in managing the drilling business.
Dato’ Sri Hadian’s involvement in the Offshore Drilling Business activities will not affect the discharge of his duty as the MD of our Group. It will be an additional role to be undertaken by him and he will be supported by a separate set of working group that will focus on the operational matters of the Offshore Drilling Business activities.
Dato’ Sri Hadian, is a Malaysian aged 61, who graduated with a Bachelor’s Degree in Chemical Engineering from the University of Canterbury, New Zealand in 1981.
Dato’ Sri Hadian’s involvement in Offshore Drilling Business commenced when he started his career with Sarawak Shell Bhd (“SSB”) in 1982 as a Well Site Engineer. After the stint as Well Site Engineer, he continued as Drilling and Operations Engineer for 3 jack up rigs. Throughout his 12-year career with SSB until 1994, Dato’ Sri Hadian was involved in various O&G E&P activities and developed his expertise in various aspects of the business as well as working with PETRONAS. In 1994, Dato’ Sri Hadian left SSB to venture into the O&G services industry providing support services to the offshore O&G industry in Malaysia, Southeast Asia and Central Asia.
Dato’ Sri Hadian joined Itochu Pipe and Tube Asia Corporation Sdn Bhd (“IPTASCORP”) in 1995 as a Director. IPTASCORP is involved in selling tubular goods and steel products to O&G companies.
In 1999, Dato’ Sri Hadian became a shareholder and director of Integrated Petroleum Services Sdn Bhd (“IPS”) which provides support services to the offshore O&G industry in Malaysia, Southeast Asia and Central Asia. In 2006, Dato’ Sri Hadian became the Chief Executive Officer of IPS until 2013.
