KUALA LUMPUR: Integrated Facilities Management provider, GFM Services Berhad (“GFM”), announced today that it has entered into a Heads of Agreement (HOA) with Shapadu Corporation Sdn. Bhd. (“Shapadu Corporation”) and its wholly-owned subsidiary, Shapadu Energy Sdn. Bhd. (“Shapadu Energy”). The HOA outlines GFM’s intent to acquire a 45% equity stake in Shapadu Energy for an indicative purchase consideration of RM30.0 million, to be fully settled in cash.
Shapadu Energy’s Operations
Shapadu Energy specializes in downstream maintenance and turnaround services at the Pengerang Refinery and Petrochemical Complex within the Pengerang Integrated Complex (PIC) in Johor. The company also performs upstream maintenance, hook-up, and commissioning activities. Through its subsidiaries, Shapadu Energy provides oil and gas (O&G) extraction, repair, and maintenance services.
Shapadu Energy, through its 60%-owned subsidiary, Shapadu CR Asia (SCRA), holds the TA4MS contract (Integrated Turnaround Main Mechanical and Maintenance Mechanical Static) with Pengerang Refining Company Sdn. Bhd. and Pengerang Petrochemical Company Sdn. Bhd. (collectively “PRefChem”) – a joint venture between Saudi Aramco and PETRONAS. SCRA delivers plant turnaround services to PRefChem’s refinery and petrochemical facilities within the PIC.
Strategic Move for GFM
Encik Ruslan Bin Nordin, Group Managing Director of GFM, highlighted:
“The Proposed Acquisition is a strategic move to strengthen GFM Group’s foothold in the O&G facilities maintenance sector. By joining forces, we aim to leverage combined strengths to enhance capacity and capabilities, particularly in delivering TA4MS services.”
GFM currently holds a TA4MS contract through its wholly-owned subsidiary, Highbase Strategic Sdn. Bhd., managing six facilities at the PIC. The inclusion of Shapadu Energy will expand GFM’s portfolio to two TA4MS contracts within the complex.
Resource Consolidation and Growth
The Proposed Acquisition will enable GFM to consolidate financial and technical resources, optimize manpower and equipment, and enhance contracts management. This positions GFM to better meet PRefChem’s expectations while pursuing larger O&G FM projects.
“Looking ahead, GFM is poised to unlock synergies through expanded project opportunities, cost optimization, and operational efficiencies – driving improved profit margins and long-term value for stakeholders,” Ruslan added.
Details of the Acquisition
- GFM will subscribe to 15% new ordinary shares in Shapadu Energy for RM10.0 million.
- GFM will acquire an additional 30% equity stake from Shapadu Corporation for RM20.0 million.
- Total indicative purchase consideration: RM30.0 million.
Put and Call Option Agreement
GFM and Shapadu will enter into a Put and Call Option Agreement. This allows GFM to sell its shares back to Shapadu Corporation and grants Shapadu the option to purchase GFM’s shares. If exercised:
- The consideration will involve shares and Redeemable Convertible Preference Shares (RCPS) in SCRA.
- GFM’s stake in SCRA could increase to 49% through share issuance, and up to 60% upon RCPS conversion.
- The options are valid for two years from the definitive agreement execution.
Next Steps
GFM, Shapadu Corporation, and Shapadu Energy intend to finalize definitive agreements within six months. The Proposed Acquisition is subject to:
- Approvals from relevant authorities.
- GFM’s shareholders at an Extraordinary General Meeting (EGM).
