Kreuz Holdings IPO

Finally an IPO. But any takers?

OIL and gas player Kreuz Holdings launched an initial public offer (IPO) of 80 million new shares on Catalist yesterday.

The IPO, which represents 15.8 per cent of the group's enlarged share capital, comprises 4.5 million public offer shares and 75.5 million placement shares.

At 27 cents each, it is tagged at a historical price-earnings ratio of about 6.9, based on the company's adjusted earnings per share of 3.9 cents for the financial year ended Dec 31, 2009.

Kreuz Holdings, which provides sub-sea services such as the inspection, repair and maintenance (IRM) of offshore production and pipeline facilities, started as a unit of Swiber Group.

It has the first right of refusal to participate in Swiber's offshore projects.

'Our close working relationship with the Swiber Group has enabled us to gain greater access to the offshore construction industry, while benefiting the Swiber Group through our provision of sub-sea services,' said Kurush Contractor, executive director and chief executive officer of Kreuz Holdings.

The company is focusing on South-east Asian and Indian offshore markets for installation and IRM projects.

'As a player servicing the oil and gas industry, we are seeing increased demand for sub-sea services,' it said.

'The stabilisation of oil prices has led to increased capital expenditure by oil and gas companies on new offshore installation and construction projects.'

The IPO is expected to raise net proceeds of about $19.2 million, $12 million of which has been earmarked for the acquisition of such assets as remotely operated vehicles and diving systems.

The remaining $7.2 million will be retained for general working capital purposes.

The public offer will open at 9am today and close at noon on July 27.

Listing and trading of the shares is expected to start at 9am on July 29.

DBS Bank is the sponsor, underwriter and placement agent for the IPO.

From Business Times, "Kreuz Holdings launches Catalist IPO of 80m shares".

Kreuz Holdings, a subsea solutions provider for the oil and gas industry, plans to raise about S$19.2 million through an initial public offering on Catalist.

Kreuz is offering 18 million new shares priced at 27 Singapore cents each.

4.5 million shares have been set aside for the public, while 75.5 million shares will be placed out.

Kreuz plans to use S$12 million of the proceeds for the acquisition of new assets, including remotely-operated vehicles and diving systems.

The remaining S$7.2 million will be used for general working capital purposes.

The company's subsea services include activities supporting new offshore installation and construction projects, as well as inspection, repair and maintenance of existing offshore production and pipeline facilities.

The public offer will open at 9am on July 22 and will close at noon on July 27.

Listing and trading of Kreuz's shares are expected to start two days later.

Looking ahead, the company said it may also acquire anchor handling tugs and make further inroads into markets in Asia Pacific and India.

"In particular, we will focus on Brunei, where there is a high demand for work in the mature oil fields, and in India, which is a market the Group is familiar with and has good knowledge of," said Kurush Contractor, CEO of Kreuz.

Kreuz Holdings is also looking at the new opportunities in the Middle East, by way of corporate alliances.

The company's order book stands at some US$133.2 million as at 16 June 2010.

It comprises secured contracts which are to be completed over the next five to 60 months, barring unforeseen circumstances.

From Channel NewsAsia, "Kreuz Holdings to raise S$19.2m in IPO on Catalist".

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