Dubai’s shipbuilder Drydocks World signed an agreement Kuok Group to set up a joint venture for its Asian operations. The new company will be named ‘DDW-PaxOcean Asia’ and be based in Singapore, reports said.
Earlier, Reuters quoted two sources as saying on Tuesday that a company linked to Malaysian billionaire Robert Kuok is about to reach a deal to buy a majority stake in the Southeast Asia operation of the Dubai shipbuilder, Drydocks, which is the shipbuilding and repair arm of Dubai World. The company is restructuring $2.2 billion of debt and sought insolvency protection in April. Shipping analysts are expecting it to announce a “global strategic alliance agreement” in Dubai on Wednesday.
The anonymous sources claimed Kuok Group, the conglomerate owned by tycoon Robert Kuok, is poised to take a majority stake in Drydock’s operations in Singapore and Indonesia. It was not immediately clear which Kuok subsidiary would perform the transaction. There was no comment available from both the companies.
Robert Kuok, Malaysia’s richest man with a net worth estimated by Forbes at $12.4 billion, made his fortune in sugar, palm oil, shipping and property. He also controls the South China Morning Post newspaper.
Dubai Drydocks bought its Southeast Asia operations in 2007 for about $2.2 billion. Its debt stems from loans it took to fund the expansion and was financed by several local and international banks.
The company’s Southeast Asia operations consist primarily of shipyards and rigs in Singapore and Indonesia. While the company’s Dubai arm has held steady, the international operations suffered during the global financial crisis as the shipbuilding industry was hit by a slump in global trade.
Khamis Juma Buamim, chairman Dubai Drydocks, said this year that the company is eyeing joint ventures for its Southeast Asia business, which could be sold off later to prospective partners if they proved to be successful.
In April, Drydocks World turned to a special tribunal to force creditors to sign up to its debt restructuring plan and filed legal proceedings in Singapore to push through the proposal.