KUALA LUMPUR, Straits Energy Resources Bhd is set to sell two tugboats to related party Sealion Ltd for a total of US$2.01 million (RM8.5 million) as part of efforts to streamline non-core assets and cut operating costs.
The company said the Labuan-based unit Victoria STS has faced a shortage of viable projects since early 2023, and the tugboats are no longer essential to current or foreseeable operations. The sale is expected to reduce operating, licensing, and insurance expenses.
In a Bursa filing, Straits Energy stated that its indirect subsidiaries, Victoria 1 Ltd and Victoria 3 Ltd, signed separate memoranda of agreement with Sealion for the disposal of TG Victoria 1 and TG Victoria 3. The related-party transaction involves TG Victoria 1 being sold for US$826,500 (RM3.49 million) and TG Victoria 3 for US$1.19 million (RM5.01 million), reflecting the interest of major shareholder Datuk Seri Tiong Chiong Kui.
Proceeds from the sale will primarily go towards repaying term loans with Orix Leasing Malaysia Bhd, to which the vessels are charged as security, and to settle amounts owed to suppliers and related companies.
TG Victoria 1, built in 1992, has a gross tonnage of 230 tonnes and a length of 34.24 metres, while TG Victoria 3, built in 2001, has a gross tonnage of 199 tonnes and measures 32.82 metres. The disposal is expected to be completed by December 2025, barring unforeseen circumstances.
Straits Energy operates in oil trading and bunkering services, land transportation and logistics, and port operations and facility management. Its shares closed unchanged at eight sen on Tuesday, giving the group a market capitalisation of RM79.56 million.
