Posted by ocbc > 1 week ago | Report Abuse

Past 5 years , yearly cash from operation average > RM$1.2b , market cap now only RM$2.9b , net cash soon !

Posted by nikicheong > 1 week ago | Report Abuse

ocbc the cash generation will slow down next year April onwards as Kraken FPSO enters the optional charter period with 70% lower revenues.

Posted by ocbc > 1 week ago | Report Abuse

MISC will have to merge with Armada for 1+1=>3 synergy, no doubt about it. Wait for the upcoming news. Win-win !

Posted by ITreeinvestor > 1 week ago | Report Abuse

https://www.thestar.com.my/business/business-news/2024/11/13/bumi-armada-is-said-to-weigh-buying-misc-offshore-energy-assets

Posted by ITreeinvestor > 1 week ago | Report Abuse

Bumi Armada Bhd., an oil field services provider controlled by Malaysian tycoon T. Ananda Krishnan, is considering buying MISC Bhd.’s offshore energy business, according to people with knowledge of the matter.

Talks between the companies are at an advanced stage and a non-binding agreement may be signed as soon as this week, said the people, asking not to be identified because the process is private. While details such as valuation are still being discussed, a potential transaction will likely involve a share swap that will give MISC a significant minority stake in Bumi Armada, the people said.

Posted by Gabriel Khoo > 1 week ago | Report Abuse

Bumi Armada Berhad ("Bumi Armada") is pleased to announce that its wholly owned subsidiary, Armada TGT Ltd ("ATL"), has successfully secured a 2-year firm period extension for the TGT Project, via the execution of a BBC Amendment Addendum dated 13 November 2024 between ATL and HLJOC ("Extension").



The Extension commences on 15 November 2024 and will expire on 7 December 2026. The aggregate contract value is approximately US$74.4 million. Apart from the contract value, the Extension was finalised based on terms consistent with the terms of the BBC.

Since commencing operations at the TGT Project, the Armada TGT1 FPSO has delivered excellent operating performance with zero lost time incidents and an average oil & gas uptime in excess of 98%.



The announcement is dated 13 November 2024.

Posted by Gabriel Khoo > 1 week ago | Report Abuse

High or low compared to current value?

Posted by spencer628 > 1 week ago | Report Abuse

ocbc,真的是就如你说的那样发展呢。

Posted by vespa > 1 week ago | Report Abuse

Thanks Treeinvestor ..Bloomberg has reported it.

Posted by nikicheong > 1 week ago | Report Abuse

The initial 6 year extension from 2018 to 2024 (6 years) was for USD285mil.

This additional 2 year extension from 2024 to 2026 (2 years) is for USD74.4mil. It seems a bit lower than the previous extension, which was worth around USD95mil for 2 years.

Posted by nikicheong > 1 week ago | Report Abuse

The idea of absorbing the FPSO business of MISC into Bumi Armada sounds more sensible than MISC outright buying the entirety of Bumi Armada.

Lets see how this plays out.

Posted by Gabriel Khoo > 1 week ago | Report Abuse

Above or below analyst expectation?

Posted by Gabriel Khoo > 1 week ago | Report Abuse

Armada needs need leadership at board level

Posted by nikicheong > 1 week ago | Report Abuse

The extension was only until 2026, which is reflective of the fact that the license extension for the TGT field to 2031 has yet to be approved by the Vietnamese authorities.

Essentially, there is another potential 5 year upside to the extension beyond 2026.

Posted by nikicheong > 1 week ago | Report Abuse

@Gabriel I don't know about analyst expectation but it is slightly lower than mine. I had it pegged at around 2 sen per share per year, but this looks more like 1.5 sen per share per year. The extension should be worth around 3 sen per share in totality.

Posted by TimCoke > 1 week ago | Report Abuse

agreed

Posted by ocbc > 1 week ago | Report Abuse

its just pricing issues, $1.10 best !

Posted by Ziko Ro > 1 week ago | Report Abuse

Discussion Armada and MISC now at the .end. Misterius Armada and MISC still dont commen and secret. Wait and see.

Posted by pang72 > 1 week ago | Report Abuse

ARMADA BERHAD (BUMI ARMADA OR COMPANY) - MEMORANDUM OF UNDERSTANDING RELATING TO A PROPOSED MERGER BETWEEN BUMI ARMADA AND THE OFFSHORE BUSINESS OF MISC BERHAD
BUMI ARMADA BERHAD

Type Announcement
Subject OTHERS
Description BUMI ARMADA BERHAD (BUMI ARMADA OR COMPANY) - MEMORANDUM OF UNDERSTANDING RELATING TO A PROPOSED MERGER BETWEEN BUMI ARMADA AND THE OFFSHORE BUSINESS OF MISC BERHAD
The Board of Directors of Bumi Armada wishes to announce that the Company had, today, entered into a non-binding memorandum of understanding (“MOU”) with MISC Berhad (“MISC”) to explore a prospective merger with MISC’s offshore business via an all shares transaction (“Proposed Merger”).



It is contemplated that the merged entity arising from the Proposed Merger will remain listed on Bursa Malaysia Securities Berhad (“Bursa Securities”) and be among the leading floating production businesses globally with the scale, resources and financial capacity to compete in the growing and capital intensive offshore floating production segment. Further, the Proposed Merger will establish a Malaysian-based sector-focused entity which leverages the combined talent pool, project development and engineering capability, and know-how of both MISC’s offshore business and Bumi Armada.



Pursuant to the MOU, the parties intend to co-operate in good faith and exclusively with each other to achieve the objectives of the Proposed Merger. In the event both parties agree to proceed with the Proposed Merger, following further assessment and satisfactory completion of due diligence, the parties may enter into negotiations on definitive agreement(s).



The MOU is effective for a period of nine months from the date of the MOU, until the execution of definitive agreement(s) or termination of the MOU, whichever is the earliest unless otherwise agreed by the parties. The MOU is not intended to have a legal and binding effect save for certain clauses relating to, among others, exclusivity and confidentiality.



A detailed announcement will be made in accordance with the Main Market Listing Requirements of Bursa Securities in the event the parties agree on the terms and conditions of the Proposed Merger and execution of definitive agreement(s).



This announcement is dated 14 November 2024.

Posted by pang72 > 1 week ago | Report Abuse

ARMADA, finally merge under Petronas!

Posted by pang72 > 6 days ago | Report Abuse

https://youtu.be/IGnVvIauxik?si=Im7A1bIFScCxNLcv
Theedge reports combine entities worth $20B
Armada market cap $2.86 B today at 50c.

Armada balloon up 6.7x from $2.96B to $20B...

Not sure how the equity swap as plan out?

Posted by ITreeinvestor > 6 days ago | Report Abuse

Armada NTA 1.05

Posted by Ziko Ro > 6 days ago | Report Abuse

If they merge Armada must push to higher price to compare with MISC

Posted by Ziko Ro > 6 days ago | Report Abuse

Petronas also have stock in MISC

Posted by nikicheong > 6 days ago | Report Abuse

Anyone have updated research report from CIMB?

Posted by pang72 > 6 days ago | Report Abuse

Market starts to react armada undervalue asset

Posted by pang72 > 6 days ago | Report Abuse

Midf, pbb gives 80c target long long long ago

Posted by pang72 > 6 days ago | Report Abuse

ARMADA can only hits the target is beg by Petronas.
Standalone is very difficult to get more contracts

Posted by pang72 > 6 days ago | Report Abuse

Combine entity worth $20B
Armada market cap $3 B only..

Huge upside ahead

Posted by nikicheong > 6 days ago | Report Abuse

Anyone have any new research reports, please share. CIMB, RHB, HLB, Citibank, Philips Capital etc. I checked Maybank, they don't have any update.

Posted by ocbc > 6 days ago | Report Abuse

Armada will be priced at $1 in exchange for MISC stakes. Win-win !

Posted by ShareFortuneTeller > 6 days ago | Report Abuse

Armanda vs MISC - who is the winner ???

Posted by pang72 > 6 days ago | Report Abuse

YINSON and MISC drop
Armada flying up

Posted by nikicheong > 6 days ago | Report Abuse

There is also a separate matter of MISC buying Ananda's stake in Bumi Armada. I believe it should be part of the MOU.

So MISC will gain controlling stake eventually by taking over Ananda's shares and getting shares in return for injecting their offshore business into Bumi Armada

Posted by nikicheong > 6 days ago | Report Abuse

Regardless, this shows that Bumi Armada is back on firm financial footing. Eventually being part of the Petronas group and having Mero 3 in its lineup will enhance the company's image even further.

Posted by ocbc > 6 days ago | Report Abuse

Armada with a global present is what MISC needs, Armada undervalue now , WIN-WIN for both of them !

Posted by Gabriel Khoo > 6 days ago | Report Abuse

https://www.klsescreener.com/v2/news/view/1425839

Posted by ITreeinvestor > 6 days ago | Report Abuse

KUALA LUMPUR (Nov 15): The proposed merger between Bumi Armada Bhd (KL:ARMADA) and MISC Bhd’s (KL:MISC) offshore businesses is expected to result in MISC holding a 68% majority stake in the new entity, with a combined valuation of RM14.6 billion, according to CIMB Securities.

Posted by Gabriel Khoo > 6 days ago | Report Abuse

KUALA LUMPUR (Nov 15): The proposed merger between Bumi Armada Bhd (KL:ARMADA) and MISC Bhd’s (KL:MISC) offshore businesses is expected to result in MISC holding a 68% majority stake in the new entity, with a combined valuation of RM14.6 billion, according to CIMB Securities.

CIMB’s estimate is based on MISC's offshore business valuation of RM10 billion at the equity level, compared to Bumi Armada’s valuation of RM4.6 billion, the research firm stated in its note on MISC on Friday.

“We view the immediate focus post transaction will be on integration and extracting synergies from the merger. Should this merger materialise, it could generate operational synergies for the combined entity,” it said. “The new entity would be well positioned to strengthen its presence in European regions such as the UK North Sea. Furthermore, it would expand opportunities in other promising markets, including Brazil and Angola”.

While specifics on the shareholding structure of the new entity remain undisclosed, analysts are largely neutral on the deal, highlighting several downside risks.

These include the complex integration of business models, systems and processes, higher merger-related costs, potential regulatory hurdles that could delay or disrupt the memorandum of understanding (MOU), and external challenges such as market uncertainty and geopolitical tensions.

“At this juncture, the possibility of a termination is still in the decks, although we opine that, given the longer period to continue discussions, both parties would find ways to mitigate the risks, while ensuring that stakeholders will continue to reap the benefits from MISC’s dividend play,” MIDF Investment Bank wrote in a separate note.

On Thursday, MISC and Bumi Armada announced the signing of a nine-month, non-binding MOU to jointly explore a potential share-based merger of MISC’s offshore business with Bumi Armada. Under the proposed merger, MISC would transfer its offshore business to a new entity in exchange for shares in that entity through a share swap arrangement.

For MISC, the merger will only involve its offshore business that owns, leases, operates and maintains offshore, floating, production, storage and offloading (FPSO) terminals. MISC mainly ships liquefied natural gas (LNG) as well as operates a fleet of petroleum tankers. MISC was previously considering a stake in Bumi Armada, The Edge reported in July.

MISC’s shares fall as earnings miss expectations
Shares of MISC Bhd declined on Friday after the group’s latest earnings, for the period ended Sept 30, 2024, fell short of analyst expectations, mainly due to weaker-than-expected performance in the gas and asset solutions division, affected by soft LNG spot rates.

The stock dropped by as much as 27 sen, or 3.4%, reaching RM7.68 during morning trade. The counter was trading at RM7.65 at the time of writing, giving MISC a market valuation of RM34.15 billion, with around 262,300 shares traded.

Kenanga Research noted that MISC's core net profit for the nine months ended Sept 30, 2024 (9MFY2024) — adjusted for non-recurring items such as a RM26.5 million unrealised forex gain, a RM44.1 million gain on other investments, and a RM66.7 million impairment loss on trade receivables —was only 69% of its full-year forecast and 64% of consensus estimates.

Amid MISC’s earnings miss, Kenanga Research reduced its earnings forecast and target price (TP) for MISC by 4%, cautioning that MISC’s gas and asset solutions division faces a challenging earnings outlook in the near to medium term amid continued pressures in the LNG market. “We cut our FY2023-2024 earnings forecasts by 4% each, reduce our TP by 4% to RM7.78 (from RM8.11) but maintain our ‘market perform’ call”.

Hong Leong Investment Bank likewise revised its earnings forecasts for MISC downward by 10%, 5.6%, and 5.4% for FY2024, FY2025, and FY2026, respectively, after factoring in a lower construction margin for the offshore segment and a reduced charter rate assumption for the petroleum division.

“Post-adjustments, we maintain a ‘hold’ call on MISC with lower sum-of-parts-derived TP of RM7.99 as we view that its risk to reward profile is balanced at this juncture. With expected yield of over 4% for FY24f-26f, we reckon the stock may not be an attractive divvy name for the time being,” it added.

MISC’s net profit for the third quarter ended Sept 30, 2024, dropped 21% to RM338.9 million from RM430.4 million in 3QFY2023, as revenue fell 12% to RM2.96 billion from RM3.37 billion.

Its 9MFY2024 net profit rose 9.6% to RM1.64 billion from RM1.49 billion in 9MFY2023, although revenue dipped slightly to RM9.93 billion from RM9.99 billion previously.

Overall, MISC has eight “buy” calls, seven “hold” calls, and no “sell” calls, with a 12-month target price of RM8.89, according to Bloomberg data.

Posted by nikicheong > 6 days ago | Report Abuse

Don't discount the possibility of a dividend declaration in the Q3 2024 results. Might be a way to extract out the excess cash, and also might be a final hurrah for Ananda Krishnan before the 2% dividend tax kicks in next year.

Posted by nikicheong > 6 days ago | Report Abuse

Bumi Armada being valued at RM4.6bil seems fair, as things stand.

However, I don't know enough about MISC's offshore business to tell whether RM10.0bil is a fair valuation.

Posted by nikicheong > 6 days ago | Report Abuse

Bumi Armada might also focus on disposing the two SC vessels in the Caspian Sea. They are no longer a core asset.

Posted by Gabriel Khoo > 6 days ago | Report Abuse

BAB and MISC MOU to explore merger of offshore businesses… ● BAB and MISC (Add, TP: RM8.97) announced to Bursa on 14 Nov 2024 that both parties have signed an MOU and will over the next nine months explore a merger of MISC’s Offshore Business Unit (OBU) with BAB in an all-share transaction. We theorise that MISC may inject its OBU into BAB in exchange for new BAB shares. Our target price for BAB implies a RM4.7bn valuation (vs. its market cap of RM3bn) while we value MISC’s offshore business at RM15bn. Combining the two entities at these valuations, we calculate that MISC will end up with a 76% stake in the merged entity (ME) while Objektif Bersatu Sdn Bhd’s (OBSB, unlisted; ultimately owned by tycoon Ananda Krishnan) stake will be diluted from 34.8% in BAB to 8.3% in the ME. ● MISC may be obliged to execute an MGO for the ME, according to the Malaysian Code on Take-Overs and Mergers 2016, but if OBSB publicly announces that it does not intend to accept the MGO, there is a chance that MISC may not cross the compulsory acquisition threshold of 90%, in our view, which fits in well with the stated intention of both MISC and BAB to keep ME listed. As such, assuming the merger is completed, we expect MISC to place out shares in ME to ensure adequate free float. … which could help BAB unlock value ● A potential merger with MISC’s OBU is likely positive for BAB shareholders, assuming that the valuations of the OBU and of BAB itself will be fair and reasonable. We believe that BAB is worth 79 sen while BAB’s BVPS is even higher at RM1.05; BAB’s current share price of 50 sen appears to undervalue the company. The potential merger, if it happens, may unlock the valuation of BAB to better reflect what we believe to be its underlying fundamental valuation. ● How will this valuation unlocking happen? First, the valuation of BAB in the merger transaction may be higher than the current BAB market cap of RM3bn, in our view, which could send a signal to the market. Second, the ME will have a strong parent company in MISC, which is majority-owned by Petronas (not listed), and which has deep pockets to fund growth at the ME. Third, BAB has plans to offer carbon capture and storage solutions in the UK North Sea via a JV named Bluestreak with shipping company Navigator Holdings (NVGS US, Not Rated, US$16.26) and with Uniper (not listed) as a potential customer. BAB also has plans to offer floating liquefied natural gas (FLNG) solutions to monetise gas resources at the Madura gas fields, offshore Indonesia. However, since BAB’s growth plans were unveiled in 2023, the market has given very little credence to those plans because BAB never discussed how those expensive projects were to be financed. But, with potential financing from MISC, the ME may have the opportunity to actualise the projects. If the market gains confidence that the ME will be able to generate growth and that it has access to equity capital to fund that growth, the undervaluation of BAB may give way to a more respectable valuation at the ME. ● From an operational perspective, BAB may also benefit from the combination of technical and engineering resources at MISC’s OBU, which may yield cost synergies since both are mid-sized floating production storage and offload (FPSO) companies. Post the merger, BAB’s shareholders could enjoy the incoming earnings and cashflows from MISC’s FPSO Mero-3, which achieved first oil and final acceptance from its client Petrobras (PBR US, Not Rated, BRL37.20) around 30 Oct 2024. This may help offset the steep drop in BAB’s earnings in FY25F as BAB’s FPSO Kraken will see its daily charter rates decline 70% from 31 Mar 2025F when the firm charter period ends. All the above are potential rerating catalysts for BAB. ● The key downside risks are if the valuation for MISC’s OBU in the merger transaction is higher than expected or if BAB’s valuation is lower than expected.

From CGS

Posted by nikicheong > 6 days ago | Report Abuse

Damn RM4.7bil (Armada) vs RM15bil (MISC). But like Raymond says, the best thing is the Bumi Armada market valuation might catch up to its RM4.7bil fair value. Still 50% to go, assuming nothing else changes.

I also don't understand why they keep saying that Bumi Armada doesn't have the balance sheet to fund the Bluestreak or Madura FLNG projects. There is RM1bil cash sitting there, plus there is room to take on significant funding given the lower gearing levels.

Posted by pang72 > 6 days ago | Report Abuse

Much clearer now that armada is the winner

Posted by pang72 > 6 days ago | Report Abuse

$4.70 B valuation equal to 78c which is largely meet IB valuation since last year...

Ie. Pbb target price 80c!!

Posted by pang72 > 6 days ago | Report Abuse

Armada new angmo ceo is great that brought armada out of huge debt to fpco powerhouse

Posted by ITreeinvestor > 6 days ago | Report Abuse

We believe that BAB is worth 79 sen while BAB’s BVPS is even higher at RM1.05;

BAB’s current share price of 50 sen appears to undervalue the company.

The potential merger, if it happens, may unlock the valuation of BAB to better reflect what we believe to be its underlying fundamental valuation.

Posted by pang72 > 6 days ago | Report Abuse

Good fine note... $1.05:)

Posted by pang72 > 6 days ago | Report Abuse

The merger invoves Petronas subsidiary which is reputable in oil n gas industrial.
I rule out any speculation play..