UMW Oil & Gas Acquires Stake in PFP Holdings in Australia

UMW Petropipe (L) Ltd., a wholly-owned subsidiary in the UMW Group has proposed to acquire 60% equity in PFP Holdings Pty Ltd (PFP) Australia, to further expand its petro-pipe business in the Oil & Gas industry.

PFP is a manufacturer as well as a trader and stockist of a complete range of pipes and fittings. Established in 1987 in Perth, Western Australia, PFP is a market leader in the supply of Piping, Valving and Pressure Vessel components to the Petrochemical, Power and Oil & Gas industries throughout the Asia Pacific region.

PFP has an established network of sales offices and branches in Singapore, Indonesia, Malaysia, Thailand, Taiwan, Philippines, China and Dubai.

PFP through its own subsidiary, CLADTEK manufactures Bi-Metal steel tubular, using CLADTEK's own uniquely developed manufacturing process combining high strength carbon steel pipe with corrosion resistant alloy (CRA) liner. It is a viable and cost effective alternative to solid CRA's or Carbon Steel with inhibitors, low risk and with high reliability products. CLADTEK Bi-Metal steel tubular has been used in Australia and Indonesia. There are two other major international players namely Japan Steel Works from Japan and BUTTING from Germany that are manufacturing similar products. The market for Bi-Metal Pipe is poised to grow rapidly with approximately 2100km planned to be installed over the next 6 years compared with 800km installed in the last 25 years.

The proposed acquisition is subject to satisfactory due diligence on PFP which is acceptable to UMW and approvals from the relevant authorities, shareholders and Board of Directors of the relevant parties. With this strategic acquisition, PFP with all its regional offices and trading centers will be in a position to add greater value to UMW Oil & Gas' aspirations to market its own brand of products and services and to further grow its regional presence in Asia Pacific, Middle East, Central Asia and Africa.

CLADTEK has participated in several tenders in the region and if successful will need to increase its production capacity. Currently, CLADTEK manufactures its Bi-Metal steel tubular in Batam, Indonesia mainly for the Indonesian market. However with this possible acquisition and with the transfer of technology, there is a strong possibility of using Malaysia as its main manufacturing base for export into the region. A Malaysian plant will contribute towards Malaysia being an Oil & Gas manufacturing hub for the region.