DDW set for 100pc PUM acquisition

DUBAI — Dubai Drydocks World, which has received acceptances of 92.29 per cent of shares of Singapore-based Pan United Marine (PUM) as of July 25, yesterday announced that it was preparing to exercise its option to acquire 100 per cent ownership of the company.

By Issac John (Deputy Business Editor)

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Published: Fri 27 Jul 2007, 10:02 AM

Last updated: Sat 4 Apr 2015, 10:23 PM

Under its original voluntary conditional cash offer, DDW, Dubai World's global shipyard operator, enjoys the right to seek total control of PUM through compulsory acquisition of the remaining shares if 90 per cent of shareholders accepted its offer, a company statement said.

For DDW, which has extended the deadline of its takeover offer for PUM by two weeks to July 25 after acquiring control of almost 85 per cent of the marine company, the Singapore foray its first major overseas acquisition that allows it to diversify its operations beyond the Middle East.

Under the deal first announced last month, Dubai Drydocks offered to pay S$2.38 a share for all remaining shares in PUM that it did not already own, valuing the company at S$648 million.

However, by yesterday it offered a total of S$650 million ($428.88 million) for the entire 100 per cent shares of PUM. After acquiring all the shares, DDW will move to de-list PUM from the Singapore Stock Exchange.

PUM, which has ship repair and building facilities in Singapore and Batam, Indonesia, posted revenue of $52.8 million and pretax profit of $8.9 million for the three months ended March 31.

Geoff Taylor, CEO, DDW, welcoming support shown by PUM shareholders for its offer, said the Dubai firm planned to compulsorily purchase the remaining shares as part of the original agreement with PUM. "The money for these shares will be deposited with the Singapore Stock Exchange for disbursement among the shareholders."

PUM specialises in ship building and repair, having built over 150 vessels. It has a shipyard in Singapore and another in Batam, Indonesia. According to sources, DDW has no intention of introducing major changes to PUM's business, at least until a review has been conducted two to three months later.

Informed industry sources said DDW is committed to long-term strategic investment in Asia as a whole. It is currently looking for opportunities in China, Vietnam, India and Sri Lanka.

DDW formally took charge of the management and operations at PUM's shipyards on July 12, when it received acceptances of 84.82 per cent of the shares.

Four of Dubai Drydocks World's nominees have been appointed to PUM's board of directors with effect from July 11.

"Dubai World, our parent holding company, is a dynamic group. Total control of PUM would give us greater flexibility to move forward with our growth plans and enable us to take group decisions with speed. Our senior management executives are already engaged in undertaking a full assessment of the assets in Singapore and Batam. At this time we have no intention to introduce any major changes to the business, redeploy any of the fixed assets, nor discontinue the employment of any of PUM's employees," Taylor said.

The acquisition of PUM, an established and well-managed shipyard in Southeast Asia, is a strategic first step in taking the expertise of the Dubai Drydocks World group companies to the international stage.

DDW is a wholly-owned entity of Dubai World and comprises Dubai Drydocks and Al Jadaf Shipyard. It also manages Platinum Yachts FZCO and Platinum Yacht Managements LLC.

With PUM firmly under its wing now, Dubai Drydocks World operates one of the largest and most comprehensive networks of shipyard facilities that stretches from the Middle East to Southeast Asia. Its services cover a fully integrated range of marine-related services including ship repairs, ship conversions and specialised ship construction.

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