Yinson sheds one of five spin-offs to home in on FPSO and energy transition business arenas

Kuala Lumpur-based energy infrastructure and technology company Yinson Holdings, which currently invests in five business units – Yinson Production, Yinson Renewables, Yinson GreenTech, Farosson, and Regulus Offshore – has set the wheels in motion to part with the last affiliate on this list, which offers integrated offshore support vessel (OSV) services.

Given Yinson’s strategic goal of directing its attention to its floating production, storage, and offloading (FPSO) and energy transition areas of business, the Malaysian player has made a new divestment move, enabling Icon Offshore to take over its offshore marine business, Regulus Offshore, which owns and charters OSVs and floating support solutions units.

The disposal, executed via a binding term sheet the duo signed for a consideration of RM 160 million (over $37.03 million), will be completed via the issuance of new shares by Icon at RM 0.88 ($0.20) per share, subject to the approval of the buyer’s shareholders and relevant government authorities.

Commenting on the sale of Regulus Offshore, Chai Jia Jun, Yinson’s Group Chief Strategy Officer, commented: “The Group’s overarching business objectives drive this divestment and we have signalled to the market that we will embark on a series of exercises to unlock value for our businesses.

“Regulus Offshore is one of our profitable legacy businesses and this transaction marks our biggest strategic decision since the last major investment back in 2015. Additionally, we believe this transaction will allow Yinson to ride the strong demand cycle in the OSV market and focus solely on our existing businesses.”

Upon completion of the divestment, which is expected around Q1 2025, Yinson will get a hold of a minority stake and board seat in Icon, allowing it to participate in its future growth. As a result of the disposal, the Malaysian giant’s portfolio will encompass four businesses: Yinson Production, Yinson Renewables, Yinson GreenTech, and Farosson.

The company is set on expanding its renewable footprint to make a name for itself as an independent power producer within clean energy. Since the firm wants to establish green technologies as a major revenue stream, it invests in new technologies and business areas that enable the global transition to a low-carbon ecosystem, through investments in marine, mobility, and energy segments.

Business is booming for Yinson’s FPSO business unit, Yinson Production, which recently confirmed the arrival of one of its FPSOs off the coast of Brazil where it will work for Petrobras.

At the end of May 2024, the company placed $1.035 billion senior secured notes to refinance another FPSO working on Petrobras’ revitalization project in Campos Basin offshore Brazil.

A few weeks before, a consortium of 13 lenders, including international banks and institutional investors, enabled Yinson Production to secure a limited recourse term loan facility of up to $1.3 billion for the pre-and post-delivery financing of an FPSO destined to operate off the coast of Angola.

Designed with a full suite of carbon emission reduction technologies, this has been described as the first-ever FPSO featuring carbon capture technology and comes with estimated carbon emissions cuts of 27% compared to a conventional design.