Propel Global Announces Disposal Of 55% Equity Interest In PCSB
Strategic Move to Divest Loss Making Subsidiar
KUALA LUMPUR, 27 OCTOBER 2023 – PROPEL GLOBAL BERHAD ("Propel Global" or the "Company”), a provider of oil and gas (“O&G”) and technical services, announced the disposal of its 55% equity interest in Propel Chemicals Sdn Bhd (“PCSB”), or formerly known as Daya Secadyme Sdn Bhd, to Hextar Kimia Sdn Bhd (“HKSB”) for a cash consideration of RM9,075,000 (“Disposal”). Alongside this, Rancak Nikmat Sdn Bhd and Wiramas Baiduri Sdn Bhd will also dispose of their collective 45% stake in PCSB to HKSB for RM7,425,000.
Group Chief Executive Officer
Ms. Angeline Lee, Executive Director / Group Chief Executive Officer of Propel Global
said, "We wish to emphasise that the decision to pursue the disposal is driven by PCSB's three-year financial losses and its struggles as a smaller player in the specialty chemicals market, competing against larger rivals with scale advantages. This divestiture represents a strategic move to exit an unprofitable venture with limited growth prospects."
She added, “Our future plans are robust and highly optimistic. We are dedicated to our core business as an oil and gas and construction service provider, with a strong focus on our engineering and technical expertise. This not only upholds our excellence in the oil and gas sector but also positions Propel Global as a one-stop integrated solutions provider across industries. We are confident that this strategy will result in exceptional value for our clients and sustained profitability for the Group.”
For the financial year ended 30 June 2023, Propel Global has posted impressive numbers, with revenue and profit before tax (excluding other income) standing at RM110.9 million and RM7.0 million respectively. This marks a significant upturn as compared to the previous financial year, where the recorded revenue and loss before tax (excluding other income) were RM77.6 million and RM19.9 million respectively. Three consecutive quarters of profitability signal that the Group is on the right track and reflect its financial resilience and strategic focus.
By fostering synergy among its subsidiaries in the O&G and technical services segments, Propel Global aims to offer holistic, customised solutions that address specific customer needs while promoting operational efficiency and sustainability. This integrated approach is designed to cultivate enduring customer relationships and secure a steady stream of recurring income, further strengthening the Group's financial position.