Bailout For Sapura – Is PMX Doing The Exact Same Thing He Criticised?
Sapura Energy ran into financial trouble back in 2019, although it received a RM1.8 billion backing allegedly from a Middle-Eastern oil and gas company that same year.
Subscribe to our FREE Newsletter, or Telegram and WhatsApp channels for the latest stories and updates.
Back in 2022, in a debate with former prime minister Datuk Seri Najib Razak, then-opposition leader Datuk Seri Anwar Ibrahim criticised the government’s decision to rescue integrated oil and gas services company Sapura Energy Bhd from its pool of debts.
He argued that any discussion about a rescue package could only take place after a forensic audit of Sapura Energy was conducted to determine whether the company – which received a lot of investment from Permodalan Nasional Berhad – had been mismanaged.
Now, as a prime minister and finance minister, Anwar has given Sapura Energy a lifeline of RM1.1 billion.
A billion-ringgit rescue
In a filing with Bursa Malaysia yesterday (11 March), Sapura Energy announced that it had received the money as an investment from Malaysia Development Holding Sdn Bhd (MDH) – a special purpose vehicle under Minister of Finance Incorporated, Malaysia Kini reported.
The investment has been earmarked exclusively for settling what Sapura Energy owes its vendors.
“As a Malaysian company supporting over 2,000 local vendors, we recognise our responsibility to preserve the Malaysian oil and gas ecosystem. Our Malaysian vendors are predominantly small and medium enterprises (SMEs) who have endured significant financial hardship during and after the Covid-19 pandemic and it had always been our intention to fully settle overdue payables to them,” said Sapura Energy group chief executive officer Muhammad Zamri Jusoh.
“We are extremely grateful to MDH for providing this funding, which will allow us to fulfil our commitment to our Malaysian vendors,” he added.
While it’s unclear whether the forensic audit as previously urged by Anwar has been conducted or not, Sapura Energy said in a statement recently that the company is conducting a “thorough due diligence process” as part of its proposed restructuring plan.
The process will involve independent experts conducting legal and financial reviews, including comprehensive internal controls and risk management reviews.
A sinking ship that keeps getting patched up
Sapura Energy ran into trouble around 2019 when it began recording annual losses.
In late May 2023, when Anwar stepped into office, external auditors Ernst & Young expressed concerns about Sapura Energy’s ability to continue as a going concern.
However, The Edge in March that year reported that Sapura Energy had received backing – speculated to be from a Middle-Eastern oil and gas company – which would provide them with financial support with a capital injection of RM1.8 billion.
Last month, it was reported that Sapura Energy had secured approval from its creditors for a proposed debt restructuring scheme which was approved by the court last Thurday (6 March).
Is there a difference between the last bailout and this one?
Farhan Zulkefly, Special Functions Officer to communications minister Fahmi Fadzil, pointed out on Twitter that in 2018, the government gave Sapura Energy a RM4 billion “lifeline” without any conditions.
What happened then was Sapura Energy still incurred losses but the top management was paid RM80 million that year.
According to Farhan, this is what Anwar criticised, as the money was supposedly meant to “save Sapura”.
And that is how the billion ringgit investment this year differs from the one in 2018, as it now comes with the condition that it be used to pay vendors that are owed.
Malaysia Kini perlu jujur dalam membandingkan bail-out kali ini dengan bail-out yang Anwar kritik sebelum ini.
— Farhan Zulkefly (@farhanzulkefly) March 12, 2025
Ini perbezaan bail-out 2025 berbanding bail-out 2018. pic.twitter.com/LrMBD5jM7M
Sapura shares rise after RM1.1 billion injection
Meanwhile, Sapura Energy’s stock leaped to its highest in more than three months after the firm secured the RM1.1 billion lifeline, as reported by The Edge.
Its shares rose to 4.5 sen on Wednesday (12 March), which was last seen in November 2024. The stock paused for the midday break at four sen, giving the company a market capitalisation of RM735 million.
Share your thoughts with us via TRP’s Facebook, Twitter, Instagram, or Threads.
