China's Rail Company CRRC Acquires 13.9% Stake in Singapore's Vallianz
Singapore's Vallianz Holdings Limited (Vallianz or Company, and together with its subsidiaries, the Group), an established provider of offshore support vessels and integrated marine solutions to the oil and gas industry, has entered into a subscription agreement with CSR Zhuzhou Electric Locomotive Research Institute (Hong Kong) Co., Limited and CRRC (Hong Kong) Co. Limited, both of which are subsidiaries of CRRC Corporation Limited (CRRC) that will bring in a total investment sum of $16.58 million (SGD 23.65 million) for Vallianz (the Proposed Investment).
China’s state-owned CRRC is the world’s largest supplier of rail transit equipment with the most complete product lines and leading technologies.
Pursuant to the subscription agreement, the two subsidiaries of CRRC shall subscribe for an aggregate of 550 million new ordinary shares in Vallianz at $0.3014 (SGD 0.43) per share. The new ordinary shares issued to CRRC will be subject to a moratorium period of one year from the date of completion of the Proposed Investment. Both of Vallianz’s major shareholders, Swiber Holdings Limited (Swiber) and Rawabi Company Holding Limited (Rawabi), have undertaken to observe a similar moratorium period of one year on their existing shareholdings.
Upon completion of the proposed transaction, CRRC shall emerge as a substantial shareholder of Vallianz with equity interest of approximately 13.9 percent in the Company’s enlarged share capital. Together, Swiber, Rawabi and CRRC will have a combined shareholding of 53.6 percent in Vallianz. CRRC will also be entitled to a seat on Vallianz’s board of directors.
Ling Yong Wah, CEO of Vallianz said, “We are honored that a major China state-owned corporation like CRRC is demonstrating its confidence in the Group’s business and our future prospects by taking a substantial equity stake in Vallianz.”
Added Ling, “Being a leading player in the global rail equipment industry, CRRC has developed sophisticated systems of international standards. Given the scale and geographical reach of our vessel operations, Vallianz will be able to provide an ideal platform for CRRC to extend the applications of its technologies and products into the global offshore and marine market.
At the same time, we view CRRC as a strategic technology partner who can enhance the Group’s vessel operations. By leveraging on CRRC’s diesel electric technology, the Group will be able to gradually move towards wider use of more environmentally-friendly vessels utilizing electric propulsion systems. This will help to raise our vessels’ fuel efficiency and yield cost savings for customers.”
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