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PDZ gets approval to enter LPG business

PDZ gets approval to enter LPG business
Malaysian marine, container and logistics company PDZ Holdings has received shareholders' approval to diversify into the liquefied petroleum gas (LPG) business.

The company had flagged this move since last year with its tie-up with another Malaysian company Ken Makmur Holdings to produce some 350 tonnes of LPG by the second quarter of the financial year ending 30 June 2019 (FY19), group managing director Aminuddin Yusof Lana told local media.

He said the LPG would come from the Rakushechnoye oil and gas field in Kazakhstan on which the two companies signed a framework agreement last year.

To pay for the new business venture worth $205m, PDZ Holdings would raise at least MYR672m ($178.9m) via the sale of new shares and rights issue with warrants.

The deal will be payable via a combination of $125m cash and the issuance of redeemable convertible preference shares for $80m.

Aminuddin said the new business was an alternative for PDZ Holdings to expand its income stream as it had been wallowing in losses for the past two financial years.

However, he said even as the company ventured into the new business, it would not jeopardise its container business and would improve its productivity and efficiency, by exercising cost-cutting measures.

TAGS: Tankers