Muscat: The board of directors of Renaissance Services is considering divesting less than 10 per cent stake in Topaz Energy and Marine (Topaz) in favour of a business house, the company said in its first half yearly results.
Topaz Energy and Marine is a wholly-owned subsidiary (specializing in oil field services) of Renaissance Services.
"This is a part of its strategic plan to ultimately float the business in a premier capital market. The investing institution is a household name," stated the company's chairman Samir J Fancy in the first half yearly result.
The company is also planning to offer up to 49 per cent investment in the Duqm permanent accommodation for contractors (PAC) project, primarily for local community investors, state pension funds and sovereign wealth funds. These initiatives are aimed at attracting co-investors who bring added value, strong local content to our businesses, or enhance international public market experience and recognition for our businesses.
Renaissance Services is planning to build a large permanent accommodation facility in Duqm economic zone for blue-collar workers of contracting firms, which will be soon engaged in building the planned mega projects.
The company plans to construct facilities to accommodate as many as 17,000 workers of contracting firms at an estimated cost of OMR100 million.
Renaissance has already awarded two contracts to develop the residential accommodation project in Duqm, spread over a total area of 192,000 square metres.
Meanwhile, Renaissance has achieved better financial performance in the second quarter of the year.
For the second quarter, the company has achieved a 7.9 per cent growth in revenue at OMR60.9 million, against OMR56.4 million for the first quarter.
Net profit in continuing businesses has also improved at OMR5.3 million in the second quarter, compared with OMR3.8 million for the first quarter.
During the first half, Renaissance has made capital investments of OMR79.3 million, which were investments in assets for growth, according to the chairman's statement.
"Capital expenditure in the Topaz Offshore Support Vessel (OSV) fleet amount to OMR74.6 million so far this year. Capital expenditure for the same period in the Contract Services Group (CSG) amounts to OMR4.7 million." The level of investment in CSG will increase substantially with the development of the company's Permanent Accommodation for Contractors (PAC) project in Duqm.
However, year-on-year performance comparisons remain slightly down as the company progresses through the transition of discontinuing businesses, in order to focus on the strategy of 'one group, two companies – Topaz and Renaissance.'
As far as Topaz is concerned, there is a specific focus to accelerate expansion of operations in West Africa and the Middle East. During the second half of 2014, the company is purchasing three new platform supply vessels. These are identical sister ships of the five vessels purchased in 2013, which have performed positively and in line with the company's expectations, both operationally and technically. These three vessels will be delivered from two different yards in China in 2014 – the first one in the end of August and the second in October and third in November.
The intention is to mobilise the vessels to West Africa, where the company has had success and where there is still strong demand. There are also competing opportunities for these vessels in the Gulf market and the Mediterranean Sea.
To contact our reporter: email@example.com