Ranhill Defers Listing as Petronas Suspends Affiliate’s License

Ranhill Energy and Resources Bhd. postponed its Kuala Lumpur listing slated for next week after an affiliate got a suspension notice from state-owned Petroliam Nasional Bhd. following a review of construction work.

The announcement comes a week after it raised 753 million ringgit ($236 million) in an initial public offering lead-managed by Malayan Banking Bhd. and CIMB Group Holdings Bhd. Proceeds from the share sale are being safeguarded by the two banks and the Malaysian Issuing House Sdn., Ranhill Energy said in an e-mailed statement. Its shares were due to debut July 31.

“Ranhill remains committed to ensuring that the interests of all stakeholders of the Ranhill group of companies, including investors in the IPO, remain safeguarded at all times,” the Kuala Lumpur-based firm said in the statement. Ranhill has submitted an appeal and is awaiting a response, it said.

Petronas, as Malaysia’s national energy company is better known, manages rights to all of the Southeast Asian nation’s oil and gas reserves and appoints outside contractors for specific projects. Without a license, companies can’t bid for jobs, the Edge Financial Daily reported today, without citing its source. Ranhill Energy relies on such work for a “significant” portion of its oil and gas revenue, the company said in the statement.

The indefinite suspension applies to Perunding Ranhill Worley Sdn. following engineering and construction work on a project in Malaysia’s southern state of Malacca, according to the statement. It doesn’t apply to any current projects being undertaken by Ranhill Energy itself or its subsidiaries, the company said.

WorleyParsons Falls

Perunding Ranhill Worley is 90 percent-owned by Ranhill Energy Chief Executive Officer Hamdan Mohamad and 10 percent held by Kamarulzaman Omar, the statement showed. The company has an exclusive arrangement to appoint Ranhill WorleyParsons Sdn. for projects it wins in Malaysia, it said.

Ranhill WorleyParsons is 51 percent-owned by Ranhill Energy with the remainder held by WorleyParsons Ltd. (WOR), Australia’s largest oil and gas engineering company. WorleyParsons, which picked Malaysia as its second global hub after Houston, fell 2.2 percent to A$21.97 in Sydney today. The benchmark index rose 0.4 percent.

“Ranhill WorleyParsons is working urgently to resolve outstanding issues with Petronas in an effort to have the suspension lifted as soon as possible,” WorleyParsons said in a separate e-mailed statement. The company “is optimistic that these discussions will lead to a commercial resolution with Petronas.”

Ranhill Energy, which also manages water concessions and power plants, was betting on its decade-long partnership with WorleyParsons to win more energy deals, Hamdan said in an interview on July 8 ahead of the share sale.

The allotment of IPO shares to successful applicants has also been deferred, Ranhill Energy said.

To contact the reporter on this story: Chong Pooi Koon in Kuala Lumpur at pchong17@bloomberg.net

To contact the editor responsible for this story: Jason Rogers at jrogers73@bloomberg.net

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