Prima Marine Pcl, an integrated service provider for the marine transport and storage of oil and liquid petrochemicals, prepares to issue IPO of around 650 million shares after SEC initiates filing process. Company charges on to expand its fleet in response to clients' demand in Asia Pacific as world economy revives.
Prima Marine (PRM), Thailand’s largest integrated service provider for the transport and storage of crude oil, petroleum products, semi-finished oil products and liquid petrochemicals, also provides transport ships to support survey work and the production of petrochemical offshore. Additionally, it manages the oil and petrochemical industry’s fleet of vessels, servicing domestic and oversea clients in the Asia Pacific region. The company is preparing to make an initial public offering (IPO) of no more than 650 million shares and expects to register in the Stock Exchange of Thailand within the year. Prima Marine executives are confident in the growth potentials for the company to provide an integrated service to transport and store crude oil, petroleum products, semi-finished oil products and liquid petrochemicals that will meet the need of clients in an efficient manner.
Mr. Manpong Senanarong, managing director of Kasikorn Securities Pcl, in his capacity as financial advisor, said Prima Marine has submitted an application to sell its shares and a securities listing form (filing) to the SEC Office to offer IPO to the public of no more than 650 million common shares. The office has already initiated proceedings on both submissions, he added.
Prima Marine is the largest integrated service provider in Thailand for the transport and storage of crude oil, petroleum products and semi-finished products, as well as liquid petrochemicals. Its transport ships also give support service for oil exploration and the production of petroleum offshore. Prima Marine also manages the fleets of the oil and petroleum industry. The company’s operation is composed of four main business groups: 1) marine transport of crude oil, petroleum products, semi-finished products, and liquid petrolchemicals; 2) marine transport and storage of crude oil and petroleum products (floating storage unit or FSU); 3) transport ships to support oil exploration and petroleum production offshore; and 4) fleet management.
Miss Veena Lertnimitr, Executive Vice President, Primary Distribution Division, Siam Commercial Bank Pcl, in her capacity as a financial advisor, said at present Prima Marine has a registered capital of 2,500 million baht with 2,500 million common shares at a par value of one baht per share. Issued and paid-up shares stand at 2,000 million baht and an IPO of common shares will be made to the public for the first time at no more than 650 million shares or 26% of all common shares issued and paid-up. This is divided into common shares offered by Prima Marine of no more than 500 million shares and common shares held by shareholders Austin Asset Limited (105 million shares) and Nathalin Co., Ltd., (45 million shares). These respectively constitute 20%, 4.2% and 1.8% of all common shares issued and paid-up. Prima Marine will invest the proceeds of this fund raising in buying new vessels to expand its marine transport fleet. Investment will also go to the floating storage unit and offshore vessel businesses. Some of the fund will be used as working capital and to pay back loans.
Mr.Chanwit Anakkul, Chief Executive Officer, Prima Marine Pcl, said the company is an integrated service provider for marine transport and storage of crude oil, petroleum products, semi-finished products and liquid petrochemicals. And as of 31 March 2017, Prima Marine and its joint venture partners have a fleet of 22 ships with a total tonnage of 2,219,002 DWT (deadweight tonnage). In addition, the group also hires oil tankers from outside companies to support its business operation and service its clients.
As of 31 March 2017, the marine transport business under the Prima Marine group and joint venture partners own 13 vessels with a total tonnage of 251,183 DWT. They are used to transport crude oil, petroleum products, semi-finished oil products, and petrochemicals from refineries, oil depots, or ports of origin. Transport routes include both domestic and overseas routes in the Asia Pacific region. For the marine transport and floating storage unit business, there are six service vessels each with 7-17 large storage tanks for a total tonnage of 1,776,065 DWT, to transport and store oil in FSUs in the capacity and duration specified by clients. The company’s FSU ships are anchored in waters between Singapore and Malaysia, which is the centre for the oil trade in Asia.
Additionally, the company has three vessels for offshore service to support survey work and the production of petroleum at sea for oil exploration and production companies. The service includes vessels to transport and store crude oil for offshore oilrigs (floating storage and offloading or FSO vessels), accommodation work boats/barges (AWB), and Anchor Handling Tug Supply (AHTS) vessels. The company has two FSO vessels with a total tonnage of 191,754 DW, and an AWB vessel that can accommodate 300 workers.
At the same time it also manages oil tankers, as well as FSU, FSO, AWB vessels and shuttle boats. It provides technical service, crew, and administration, to ensure safety for the crews, the goods and the ships, all the while bearing in mind potential effects on the environment.
“We have expertise in the transport and storage of oil and liquid petrochemicals business. Our service is integrated and complete, from sea transport to oil storage on FSU vessels, to support ships for oil exploration and petroleum production at sea, and management of the fleet of the oil and petrochemical industry. This gives us a competitive edge to better service client groups such as large oil companies, oil refineries, and big oil traders, both domestic and foreign. The result is that the company has good potentials for continuous growth corresponding to the increasing demand for oil use in the Asia Pacific region,” Mr Chanwit said.
The chief executive officer of Prima Marine added that the company plans to use the proceeds from this fund raising to increase its capability in the transport and storage of crude oil, petroleum products, semi-finished oil products and liquid petrochemicals. It will also be used to improve support for survey work and petroleum production at sea and the management of fleets. Major plans to expand the fleet between 2017-2019 include:
1. Nine transport vessels of between 3,000-10,000 DWT each, with a project cost of 2,340 million baht. This will give the company an increased transport capacity of 3,800 million litres a year. Investment will also be made on 11 large transport vessels composing of a 14,000 DWT ship, a Medium Range (MR) vessel, a Large Range (LR) vessel, an Aframax tanker, and a Very Large Crude Carrier (VLCC), to handle the growth of the transport business and support the marine transport and FSU business. The total value of the project is 6,890 million baht and is expected to increase the transport volume by another 16,700 million litres per year.
2. Expansion of the marine transport and FSU business to increase the capacity to store oil with the purchase of another four vessels. The project is worth 4,200 million baht and will meet the growth of the marine transport and storage industry for crude oil and petroleum products in the Southeast Asia region.
3. The purchase of two floating, storage and offloading (FSO) vessels for oilrigs. Total project value is around 1,090 million baht and will meet the growth of the oil exploration and production at sea in Thai waters as well as those of neighbouring countries in Southeast Asia.
These investment plans are for improving the potentials of the company in marine transport, both quantitatively and qualitatively, expand the marine transport market for petrochemicals which could grow quickly, as well as expand the boundary for goods transport to new shipping routes, both domestic and overseas, such as those from Thailand to Myanmar, China, and Japan. They will also expand the client base, especially those from Thailand and neighbouring countries in Southeast Asia with good growth prospects.