CH OFFSHORE LTD PROPOSED TRANSACTIONS

Transcription

1 CH OFFSHORE LTD (Incorporated in the Republic of Singapore) Company Registration No D PROPOSED TRANSACTIONS 1. INTRODUCTION 1.1 Proposed Transactions. The Board of Directors of CH Offshore Ltd ( CH Offshore or the Company ) is pleased to announce that the following agreements have been entered into today: (a) (b) (c) (d) (e) (f) a bareboat charter (the "Beryl Bareboat Charter") of the "Beryl" (ex "Beryl") between MarineCo Limited ( MarineCo ) and Gemini Sprint Sdn Bhd ( Gemini ); a bareboat charter (the "Zircon Bareboat Charter") of the "Zircon" (ex "Zircon") between MarineCo and Gemini; a ship management agreement (the "Beryl Ship Management Agreement") between Chuan Hup Agencies Pte Ltd ( CHA ) and Gemini in relation to the Beryl ; a ship management agreement (the "Zircon Ship Management Agreement") between CHA and Gemini in relation to the Zircon ; a time charter (the "Beryl Time Charter") of the Beryl between Gemini and Oilserve Marine Sdn Bhd ( Oilserve ); and a time charter (the "Zircon Time Charter") of the Zircon between Gemini and Oilserve. 1.2 MarineCo Limited. On 25 April 2006, CH Offshore announced that it had entered into two separate memoranda of agreement to sell the "Beryl" and the "Zircon" to MarineCo for an aggregate consideration of US$23 million, which was arrived at on a willing seller and willing buyer basis. MarineCo is a company in which Scomi Marine Bhd ( Scomi ) (a controlling shareholder of the Company) and the Company own 51 per cent. and 49 per cent. respectively of the issued share capital. On 8 June 2006, the Company and Scomi signed an agreement to set out their rights and obligations in relation to MarineCo (the MarineCo Joint Venture ). 1.3 Gemini Sprint Sdn Bhd. Gemini was incorporated on 18 April 2006 in Labuan, Malaysia. It has an authorized share capital of RM100,000 divided into 100,000 ordinary shares of RM1.00 each, of which 100 shares are issued and fully paid up. The Company had on 8 June 2006 subscribed for 49 ordinary shares of RM1.00 each in Gemini while Scomi had subscribed for the remaining 51 ordinary shares in Gemini. As a result of the above subscription, Gemini became a joint venture company between the Company and Scomi and an associated company of the Company. On 8 June 2006, the Company and Scomi signed an agreement to set out their rights and obligations in relation to Gemini (the Gemini Joint Venture ). 1

2 1.4 Beryl Bareboat Charter and Zircon Bareboat Charter. Under the Beryl Bareboat Charter and the Zircon Bareboat Charter (the Bareboat Charters ) respectively, MarineCo will charter the Beryl and the Zircon to Gemini for a minimum period of 3 years for US$4.38 million each, calculated at the rate of US$4,000 per day on commercially agreed terms pursuant to negotiations between MarineCo and Gemini. The Beryl Bareboat Charter is conditional upon the completion of the sale of the Beryl by the Company to MarineCo, and the Zircon Bareboat Charter is conditional upon the completion of the sale of the Zircon by the Company to MarineCo. 1.5 Beryl Ship Management Agreement and Zircon Ship Management Agreement. The Beryl Ship Management Agreement and Zircon Ship Management Agreement (the Ship Management Agreements ) are for a period of 3 years and the management fee payable by Gemini to CHA is US$7,000 per month in relation to each of the Beryl and the Zircon on commercially agreed terms pursuant to negotiations between Gemini and CHA. The Beryl Ship Management Agreement is conditional upon the completion of the Beryl Bareboat Charter between MarineCo and Gemini, and the Zircon Ship Management Agreement is conditional upon the completion of the Zircon Bareboat Charter between MarineCo and Gemini. 1.6 Beryl Time Charter and Zircon Time Charter. The Beryl Time Charter and the Zircon Time Charter (the Time Charters ) are for a period of 3 years, under which Oilserve will pay Gemini a daily charter rate of US$5,998 and US$6, in relation to each of the Beryl and the Zircon on commercially agreed terms pursuant to negotiations between Gemini and Oilserve. The Beryl Time Charter is conditional upon the completion of the Beryl Bareboat Charter, and the Zircon Time Charter is conditional upon the completion of the Zircon Bareboat Charter. 2. INTERESTED PERSON TRANSACTIONS 2.1 Chapter 9 of the Listing Manual. As: (a) (b) (c) MarineCo and Gemini are associated companies of the Company, and as MarineCo and Gemini are subsidiaries of Scomi, a controlling shareholder of the Company; CHA is a subsidiary of the Company, and as Gemini is a subsidiary of Scomi, a controlling shareholder of the Company; and Gemini is an associated company of the Company, and as Oilserve is a subsidiary of Scomi Group Berhad, a controlling shareholder of the Company, the Bareboat Charters, the Ship Management Agreements and the Time Charters (collectively, the "Proposed Transactions") are all interested person transactions for the purposes of Chapter 9 of the listing manual (the Listing Manual ) of the Singapore Exchange Securities Trading Limited (the SGX-ST ). 2.2 Shareholders Approval. As the value of the Proposed Transactions, when aggregated to the 2

3 amount payable to the Company by MarineCo for the purchase of the Beryl and the Zircon exceeds 5 per cent. of the latest audited consolidated net tangible assets of CH Offshore and its subsidiaries (the CHO Group ) of approximately US$82.81 million as at 30 June 2005, the Proposed Transactions require the approval of shareholders of the Company in accordance with Chapter 9 of the Listing Manual. 2.3 Total Value of Interested Person Transactions. As at the date of this Announcement, the total value of all interested person transactions entered into by the Company since the beginning of the current financial year is set out below: Interested Persons Chuan Hup Holdings Limited Group of Companies Aggregate Value US$ Scomi Group Berhad Group of Companies 23,479 (1) Note: (1) This amount includes the proposed disposal of the Beryl and the Zircon for an aggregate consideration of US$23 million which is subject to shareholders approval. 3. RATIONALE FOR THE PROPOSED TRANSACTIONS The Directors believe that the Proposed Transactions are in the interests of shareholders of the Company. In so doing, the Directors considered that the Proposed Transactions will allow the Company to utilize its current resources and expertise to manage the Beryl and the Zircon optimally, and benefit from operational and strategic synergies between the CHO Group and the Scomi Group. In addition, the Proposed Transactions, together with the proposed disposal of the Beryl and the Zircon, will allow the Company to benefit from the existing tax incentives accorded for Labuan incorporated companies. 4. INDEPENDENT FINANCIAL ADVISER 4.1 Independent Financial Adviser. Pursuant to Rule 921(4)(a) of the Listing Manual, the Company will be appointing an independent financial adviser ( IFA ) to provide an opinion on whether the Proposed Transactions (and all other transactions which are the subject of aggregation under Rule 906 of the Listing Manual) are on normal commercial terms and are not prejudicial to the interests of the Company and its minority shareholders. 4.2 Opinion. The IFA will issue an opinion following a full review of the financial terms of the Proposed Transactions and the opinion will be included in the circular (the Circular ) to be despatched to the shareholders to convene an extraordinary general meeting (the EGM ) to 3

4 approve the Proposed Transactions. 5. AUDIT COMMITTEE STATEMENTS In relation to the MarineCo Joint Venture and the Gemini Joint Venture between the Company and Scomi, the Audit Committee, comprising Mdm Young Sau Kwan, Mr Billy Lee Beng Cheng and Encik Aminuddin Yusof Lana, is of the view that the risks and rewards of the MarineCo Joint Venture and the Gemini Joint Venture are in proportion to the equity of each joint venture partner of MarineCo and Gemini and the terms of the MarineCo Joint Venture and the Gemini Joint Venture are not prejudicial to the interests of the Company and its minority shareholders. In relation to the Proposed Transactions, the Audit Committee, will form its view as to whether the Proposed Transactions are on normal commercial terms and are not prejudicial to the interests of the Company and its minority shareholders after considering the IFA s opinion referred to in paragraph 4.2 above. The Audit Committee s view on the Proposed Transactions will be set out in the Circular. 6. APPROVALS 6.1 Conditions. Completion of the Proposed Transactions is conditional upon, inter alia, the approval of the shareholders at the EGM to be convened in accordance with Chapter 9 of the Listing Manual for the Proposed Transactions. 6.2 Abstention from Voting. Scomi and its associates will abstain from voting on their shares in the Company, if any, at the EGM relating to the Proposed Transactions. 7. DIRECTORS INTERESTS AND CONTROLLING SHAREHOLDERS INTEREST 7.1 Interests of Directors. Save that Dato' Kamaluddin Bin Abdullah and Encik Shah Hakim Bin Zain are substantial shareholders of Scomi Group Berhad, Mr Peh Kwee Chim is a substantial shareholder of the Company and Mr Cheak Boon Heng, Mdm Joanna Young Sau Kwan, Mr Ong Kok Wah and Mr Loh Kee Kong are shareholders of the Company, none of the Directors of the Company has any interest, direct or indirect, in the Proposed Transactions. 7.2 Controlling Shareholders Interests. Scomi has a direct interest in 205,000,000 shares in the Company representing approximately per cent. of the issued shares of the Company. Scomi Group Berhad and Scomi have interests in MarineCo, Gemini and Oilserve, all of which are set out herein. Save as disclosed, none of the controlling shareholders has any interest in the Proposed Transactions. 8. SERVICE CONTRACTS 4

5 No directors will be appointed to the Company in connection with the Proposed Transactions. 9. DOCUMENTS FOR INSPECTION Copies of the Bareboat Charters, the Ship Management Agreements, the Time Charters and the agreements dated 8 June 2006 in relation to the MarineCo Joint Venture and the Gemini Joint Venture are available for inspection at the registered office of the Company during normal business hours for a period of 3 months from the date of this Announcement. 10. GENERAL A circular containing further details of the Proposed Transactions and convening the EGM for the purpose of seeking the approval of shareholders will be despatched to shareholders in due course. BY THE ORDER OF THE BOARD Valerie Tan May Wei Singapore, 8 June