Singapore: Malaysia’s Maybank has given a big thumbs up to Ezion Holdings and news that the Singapore government is to come onboard as a strategic investor.
EDB Investments, the corporate investment arm of the Economic Development Board, is paying S$19m for 14.3m new shares in Ezion.
“Other than providing financing, we believe that EDBI could open gateways for Ezion to secure more contracts from prominent oil and gas players, given its extensive network. Reiterate BUY and with target price lowered to SGD1.81 as we adjust for dilution from new shares,” Maybank wrote in a report issued yesterday.
The bank noted that traditionally, Ezion secures its financing before announcement of any contracts. “We view EDBI’s investment in Ezion not only as a positive sign of endorsement but also as a prelude to more contract wins,” Maybank stated, suggesting Mexico’s Pemex, who have contracted with Ezion five times so far, are likely to come back for more business soon. [20/12/12]