KUALA LUMPUR: Sapura Energy Bhd’s (SEB) shares emerged the most active counter on Bursa Malaysia in the morning session today, with its price rising four per cent after announcing a proposed partnership with the Austria-listed industrial company, OMV Aktiengesellschaft (OMV AG), last Friday.
At 10.13 am, Sapura’s shares rose 1.5 sen to 39 sen, with 69.70 million shares traded.
On Friday, SEB said it had proposed a strategic partnership with OMV AG via SEB Upstream Sdn Bhd (SUP), a joint venture company incorporated to hold the entire equity interest of Sapura Upstream Sdn Bhd (SUSB), through which it would raise up to US$975 million (RM4.06 billion) in proceeds.
Pursuant to the announcement, Public Investment Bank Bhd had maintained its “trading buy” rating on SEB with an unchanged target price of 81 sen.
“With this move, we can see a clearer direction for the group’s upstream business moving forward, immediately eliminating the listing option of this segment, as this is the better and quicker approach to improving its financial health.
“Moreover, this partnership enables SEB to strengthen its global presence in new markets via OMV AG’s existing global core regions in Romania and Austria,” it said in a note today.
Meanwhile, Maybank Investment Bank Bhd has maintained a “buy” call on SEB with a revised target price of 55 sen from RM1.20 previously.
The research house said despite the deal between SEB and OMV AG and improvements in operations and sentiment, SEB’s financials were only expected to recover in the financial year ended Jan 31, 2021 (FY21).
“We expect the company to remain in the red in FY19 and potentially break-even in FY20. As such, the focus should be on the turnaround in FY21,” it added.