UAE-based Lamprell, a leading provider of engineering, procurement, construction and contracting services for the energy sector, said it has received a non-binding indicative cash offer from its key shareholder, Blofeld Investment Management, and the board of directors was studying the proposal.

 

In the offer, Blofeld, which owns 25.06% of the oilfield services provider, has indicated it is willing to acquire the rest of the cash-strapped company, albeit at a very significant discount to the prevailing share price.

 

Negotiations between the two parties are continuing in light of the group's liquidity position. 

 

In its disclosure on the London Stock Exchange (LSE), Lamprell said any acceptable offer would need to include an interim funding solution or bridge financing.

 

The bid offer comes at a time for Lamprell when it is facing an 'urgent and severe liquidity constraints'.

 

The struggling Emirati oil and gas services firm recently saw its shares collapse by more than 70 per cent after it stated that it was at risk of not meeting $75 million in funding obligations over the next two months, should a short-term resolution not be found.

 

According to industry sources, Lamprell is urgently pursuing the options available to deliver a funding solution that will resolve the group’s immediate and severe liquidity concerns."

 

With only $8.4 million in net cash as of 23 June (down from $52.9 million at end-2021) Lamprell said that it "requires an immediate funding solution or bridge financing to a funding solution in order to meet immediate funding obligations of $75 million."

 

The Dubai-based business, which provides equipment like jackup rigs and wind turbine foundations for the energy industry, said it had not agreed any new financing deal since the year began.

 

According to Lamprell, both parties have been in discussions for more than two months but have not reached agreement on the price or conditions of the offer or in relation to the interim funding solution or bridge financing.

 

Lamprell said it will continue to work together with Blofeld to try to reach a workable solution by way of an updated offer, which also provides a solution to the immediate liquidity needs of the group.

 

However, there can be no certainty that any offer for the company will be forthcoming nor as to the terms of any such offer, nor any certainty as to agreement on the interim financing solution with Blofeld, particularly in the time available, it added.-TradeArabia News Service