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Vallianz has executed several noteworthy initiatives in 2014
Firstly, Vallianz announced on 12 Apr 2014 that they have entered into a collaboration arrangement with a first class Chinese shipyard to build Vallianz [euro]" designed vessels. Vallianz has the right of refusal for up to 200 vessels. This is a strategic step to manage their asset base and fleet renewal.
Secondly, Vallianz announced on 22 Sep 2014 that they were acquiring a Singapore incorporated Jetlee Shipbuilding and Engineering Pte Ltd so as to establish their own marine base for docking and maintenance operations.
According to the company, this should result in cost savings and enhance operational efficiencies. The purchase of Jetlee would be settled by issuance of 143.3 million Vallianz shares at an issue price of $0.138 per share.
It is noteworthy that the issue price of $0.138 was at a 24 percent premium to Vallianz[euro](TM)s volume weighted average price ([euro]oeVWAP[euro]) of $0.1116 per share. The owners of Jetlee Group are industry veterans and comprise of Mr Chan Kwan Bian (co-founder of Labroy Marine), Mr Teo Guo Ping (previously working at Pan-United Corp) and Mr Ng Chee Keong (founder of Jetlee through a joint venture with Pan-United Marine Limited).
As the consideration will be entirely settled via Vallianz shares, priced at a significant premium to the current price (then), it is likely that the Jetlee owners are confident in Vallianz[euro](TM)s business and growth prospects.
Thirdly, Vallianz announced on 30 Sep 2014 that they are acquiring OER Holdings Pte Ltd, a provider of manpower services to the offshore industry for US$27.7 million.
OER Holdings[euro](TM) 2013 earnings before interest, tax, depreciation and amortization ([euro]oeEBITDA[euro]) was around US$5.6m. Thus, it was priced at approximately 5x 2013 EBITDA. According...