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New Straits Times
2 days ago
- Business
- New Straits Times
Analysts tie Stonepeak's Yinson interest to FPSO boom
KUALA LUMPUR: Stonepeak Partners' interest in Yinson Holdings Bhd may stem from surging global demand for floating production storage and offloading (FPSO) vessels, which, according to Energy Maritime Associates, is projected to top US$88 billion over five years, analysts said. The New York-based infrastructure investor is reportedly in exclusive talks to acquire Yinson, potentially valuing the Malaysian energy infrastructure firm at up to RM9 billion, making it one of the country's largest deals this year. On June 6, reports emerged that Stonepeak is in exclusive discussions to buy out Yinson, citing sources familiar with the matter. The deal involves collaboration with the Lim family, Yinson's founder and largest shareholder, which held a 26.6 per cent stake as of May 30, aiming to take the energy infrastructure firm private. Analysts see the deal as a strategic fit. Stonepeak's focus on infrastructure-backed, cash-generating assets aligns with Yinson's core FPSO business, which includes long-term contracts across Africa, Asia, and South America. The acquisition would also expand Stonepeak's presence in Asia-Pacific energy infrastructure, an analyst told Business Times on condition of anonymity. However, Yinson has clarified that it is not in discussions with any third party in respect of a buyout exercise. Executive chairman Lim Han Weng said the company is currently engaged in exploratory talks with various parties on potential corporate proposals related to its shareholding. "However, given that the discussions are still at an exploratory stage, there is currently no conclusive indication that the discussions would give rise to a corporate proposal involving Yinson," it said in a filing to Bursa Malaysia on Monday. Crown jewel The FPSO business is the crown jewel of the Lim family empire. Yinson, controlled by founder Lim Han Weng and son Lim Chern Yuan, is currently the second-largest FPSO operator globally. "The Lims have built Yinson into a well-oiled money machine. They have transformed Yinson into a highly efficient and profitable operation, making it an attractive takeover candidate," the analyst said. Lim (Chern Yuan) revealed in an April Forbes interview that Yinson plans to bid for three mega-FPSO projects, worth at least US$1.5 billion each in that period. While he did not disclose details of the bid, Maybank Investment Bank analyst Jeremie Yap believed they could be in Ghana, Ivory Coast and Malaysia. Yap wrote in a March research note that given Yinson's track record, it is well positioned to win future projects and could be a preferred choice for the bids. Meanwhile, CIMB Research Sdn Bhd said that the RM9 billion valuation translates to RM3.23 per share, a 38 per cent premium over Yinson's last close of RM2.34 and 10.2 per cent above the research firm's target price of RM2.93. If confirmed, this could pave the way for a privatisation offer, the firm said in a note. Yinson's shares have declined 23 per cent over the past year, partly due to the post-tariff market downturn. Following news of the potential buyout, Yinson's share price jumped 13.8 per cent on June 6, its largest single-day gain since 2019, narrowing year-to-date losses from 33.7 per cent to 11.4 per cent and lifting its market capitalisation to RM6.5 billion. CIMB highlighted that the exclusive negotiations indicate advanced discussions involving the Lim family. Stonepeak's interest aligns with its strategy to invest in infrastructure-based, cash-generating assets with long-term contracts, characteristics exemplified by Yinson's FPSO business. "This deal would also help Stonepeak increase its exposure in Asia Pacific energy infrastructure, where Yinson has already established a solid and growing footprint. However, Yinson has declined to comment, stating that the information remains unverified," CIMB said. Yinson's portfolio includes a solid project backlog valued at US$20.5 billion and eight active FPSO contracts. Its growing footprint in emerging markets, along with energy transition initiatives such as solar and battery storage, supports the premium valuation. Stonepeak would gain deeper access to the Asia-Pacific energy infrastructure sector through this acquisition. CIMB noted that Yinson's FY24 price-to-earnings (P/E.) ratio of 9.5x, though higher than the industry average of 8.2x, is justified by its scale, strong project pipeline, and exposure to energy transition. For comparison, peers SBM Offshore and Modec trade at 4.8x and 11.6x, respectively. Stonepeak is expected to value Yinson's strategic growth in FPSO contracts, especially after Yinson's recent efforts to strengthen its financial position, including raising US$1 billion in January 2025 from a consortium of institutional investors, and growth in its renewable energy segments, CIMB said. The US$1 billion funding round included top investors such as Abu Dhabi Investment Authority, British Columbia Investment Management, and RRJ Capital, supporting both FPSO expansion and the renewable energy portfolio. Despite a 22 per cent drop in net profit to RM752 million for FY2025, due to higher financing costs and lower engineering revenue, CIMB forecasts stronger results ahead, particularly with the Agogo FPSO expected to start production by September. CIMB maintains its Buy rating on Yinson, with a target price of RM2.93 and earnings estimates for FY2026–2028. Potential catalysts for re-rating include contributions from FPSO projects Maria Quiteria, Atlanta, and Agogo, alongside possible asset monetisation and privatisation. Risks remain, including possible delays or cost overruns in FPSO projects and ongoing losses in the green technology segment.
BusinessToday
2 days ago
- Business
- BusinessToday
Stonepeak Partners' Reported Acquisition Of Yinson Could Value The Deal At RM9 Billion
Yinson Holdings Bhd - FSO (FPSO) Helang New York-based infrastructure investment firm Stonepeak Partners is reportedly in exclusive negotiations to acquire Malaysian energy infrastructure company Yinson Holdings Berhad, in a deal that could value the company at up to RM9 billion (US$2.1 billion). The development was first reported by Bloomberg. According to analysis by CIMB Research, this valuation translates to approximately RM3.23 per share, based on Yinson's 2.784 billion existing shares. CIMB Research indicated that if the report proves accurate, these exclusive talks could pave the way for a privatisation offer for the remaining shares of Yinson. Yinson's current market capitalisation stands at around RM6.5 billion. CIMB Research noted that the exclusivity arrangement suggests the deal has entered advanced stages of negotiation. The Lim family, who founded Yinson, currently holds a significant 26.6% stake in the company. The research house also commented that Stonepeak's investment focus appears to align well with Yinson's strategic direction, particularly given Yinson's growing presence in floating production, storage, and offloading (FPSO) and renewable energy sectors. From a valuation perspective, CIMB Research highlighted that the indicative RM9.0 billion take-private valuation, equivalent to RM3.23 per share, implies a substantial 38.0% premium to Yinson's last closing price. Relative to CIMB Research's own target price of RM2.93, the proposed acquisition price would represent a slight premium of 10.2%, suggesting potential additional upside should a formal offer materialize. Related
Malaysian Reserve
3 days ago
- Business
- Malaysian Reserve
Yinson continues to surge on takeover report, CIMB Sec maintain RM2.93 target price
OIL-AND-GAS services firm Yinson Holdings Bhd continued to surge in early trading today after potential buyout talks. At 9.30am today, the counter was up 6 sen or 2.6% to RM2.40, with 5.6 million shares exchanging hands. On June 6, Bloomberg reported that US-based Stonepeak Partners was in exclusive talks with the Lim family, led by Lim Han Weng, which holds a 26.6% stake in Yinson, to take the company private, in a deal that could value the group at up to RM9 billion (US$2.1 billion). In a report today, CIMB Securities noted that the New York-based infrastructure investment firm Stonepeak Partners was reported to be in exclusive talks to acquire Yinson. It said the valuation equated to RM3.23 per share based on 2,784 million existing shares in Yinson, and represents a 38.0% premium over the last closing price of RM2.34 and a 10.2% premium to its target price of RM2.93. If the report is accurate, this could potentially lead to a privatisation offer for the remaining Yinson shares, it added. 'In our view, the exclusivity arrangement indicates that the deal has entered advanced stages of negotiation, with the Lim family — Yinson's founder — holding a 26.6% stake. 'Stonepeak's investment focus appears aligned with Yinson's strategic direction. Yinson fits Stonepeak's preference for infrastructure-based, cash-generating assets with long-term contracts. This deal would also help Stonepeak increase its exposure in Asia Pacific energy infrastructure, where Yinson has already established a solid and growing footprint,' CIMB Securities said in the report. –TMR
The Sun
14-05-2025
- Business
- The Sun
Steel Hawk's Q1 FY25 net profit surges 126%, hits RM8.17m
KUALA LUMPUR: Oil and gas services and equipment provider, Steel Hawk Bhd achieved more than 2-fold increase in net profit to RM8.17 million for the first quarter (Q1) ended March 31, 2025 (FY25) from RM3.23 million posted in Q1 FY24. This strong performance was underpinned by a significant surge in revenue, which rose to RM52.48 million in Q1 FY25, compared to RM19.74 million in Q1 FY24. The notable improvement in the group's financial results was driven by the robust performance of its core engineering, procurement, construction, and commissioning (EPCC) division, supported by new work orders secured from Petroliam Nasional Bhd (Petronas) and its group of companies. The EPCC division generated a substantial RM50.58 million in revenue during Q1 FY25, accounting for 96.38% of total revenue, compared to RM15.89 million, or 80.50%, in Q1 FY24. The remaining contribution came from the Installation and Maintenance (I&M) segment at RM1.56 million, or 2.97%, and the Supply of Oilfield Equipment (SOFE) segment at RM0.34 million, or 0.65%. Deputy chairman and executive director Datuk Sharman K Michael said while the company has seen strong momentum in the past, this quarter marks Steel Hawk's most substantial leap forward to date - both in scale and pace - underscoring the resilience of its business and the positive trajectory it continues to build on. 'In less than a year, we have successfully secured seven contracts in total - an achievement that reflects the significant progress we have made and one that we take great pride in. 'Among our key wins are our appointments as a panel contractor for the construction and modification works of 27 downstream operating plants and for EPCC services for remote operations - both awarded by Petronas Carigali Sdn Bhd (PCSB). 'Additionally, our contract for onshore facilities maintenance, construction, and modification services has been extended by PCSB for another year beyond its original expiry on December 31, 2024. 'Most recently, PCSB awarded us the contract for splash zone structural repair and maintenance services. These significant wins are generating a substantial flow of work and reinforcing our market position. With 14 active contracts to date, we are well-positioned with a steady project flow secured through to 2030. 'As we look ahead to the upcoming quarters, our strategy remains anchored on three core priorities: securing new contract wins, executing projects with the highest standards of efficiency, and maintaining a disciplined approach to cost management. 'Despite ongoing concerns over oil price fluctuations, our performance demonstrates the strength of our business model. It is important to emphasise that Steel Hawk primarily operates in the operating expenditure (Opex) segment rather than the capital expenditure (Capex) segment. 'This strategic focus is a key factor supporting the resilience and sustainability of our operations,' Sharman said. Steel Hawk maintained a healthy balance sheet with a manageable net gearing of 0.50 times as of March 31, 2025. Additionally, the company's net assets per share increased to 11.13 sen from 9.46 sen recorded as of December 31, 2024.
