The implementation of the oil and gas service provider’s regularisation plan to exit its Practice Note 17 (PN17) status resulted in Maybank, CIMB, and RHB emerging as major shareholders of the “rebranded” entity.
In a note today, MBSB Research said the restructuring of Vantris could add as much as 2.3% to its creditor banks’ earnings this year.
It said the creditor banks are expected to recognise earnings contributions from settlement shares issued at 80 sen apiece.
Based on the current market price of 53 sen per share, the proceeds translate into an uplift of between 1.5% and 2.3% of net profit this year, it noted.
The research house also said Maybank was likely to see the “largest absolute impact”. Malaysia’s largest bank ended up with a 20.27% stake in Vantris, post restructuring.
In a bourse filing last Friday, Maybank said Vantris had issued 462.45 million new shares and 498.48 million redeemable convertible unsecured Islamic debt securities (RCUIDS) to the bank and its unit Maybank Islamic Bhd.
This formed part of the settlement of liabilities owed by Sapura TMC Sdn Bhd, a wholly owned subsidiary of Vantris.
In a separate filing, CIMB disclosed its subsidiaries also received new securities.
CIMB Bank Bhd obtained 208.93 million shares and 225.21 million RCUIDS, while CIMB Islamic Bank Bhd received 67.73 million shares and 73.01 million RCUIDS. Together, they hold a combined 12.13% stake in Vantris.
Meanwhile, RHB said its subsidiary RHB Islamic Bank received 164.56 million shares and 177.39 million RCUIDS, giving the banking group a 7.21% indirect stake in the company.
MBSB noted that other listed creditors, particularly AMMB Holdings Bhd (AMMB), did not issue announcements, likely being short of the 5% shareholding disclosure threshold.
Exiting PN17
Vantris had secured approval from the stock exchange regulator in June for its regularisation plan to exit its PN17 classification, which it fell under in 2022 due to financial distress.
Under the plan, the company will perform a 99.99% capital reduction to offset accumulated losses, along with a 20-to-one share consolidation to slash the number of shares in circulation.
The debt restructuring will reduce its borrowings from RM10.8 billion to about RM5.6 billion, cutting annual interest expenses by more than RM500 million, or approximately 60%.
The plan also involves a RM1.1 billion capital injection from the ministry of finance, via Malaysia Development Holding Sdn Bhd (MDH), through redeemable convertible loan stocks (RCLS). Proceeds from this subscription have been earmarked to settle outstanding payments to Malaysian oil and gas vendors.
Upon full conversion of the RCLS, MDH could emerge as Vantris’ single largest shareholder with over a 33% stake, overtaking Permodalan Nasional Bhd, whose stake may be diluted to just above 5%.
Vantris closed 6.6% or 3.5 sen higher at 56 sen, valuing the group at RM1.29 billion.