KUCHING: Reservoir Link Sdn Bhd (RLSB) is to acquire the remaining 70 per cent stake in Propel Maxflo Sdn Bhd (Maxflo) for RM17.24 million.
The proposed acquisition will be satisfied via a combination of cash (RM13.79 million) and the balance of RM3.45 million via the issuance of about 18.69 million new RLEB shares at an issue price of RM0.1845 per share.
RLSB, which is a wholly-owned subsidiary of Reservoir Link Energy Bhd (RLEB), acquired 30 per cent of Maxflo from Propel Oilfield Services Sdn Bhd for RM7.39 million on May 2, 2025 and the latter becomes its associate company.
Propel Oilfield is a 49 per cent-owned subsidiary of Propel Global Bhd, also a listed company on KLSE.
RLSB and Propel Oilfield entered into a conditional share sale agreement on the latest deal on October 7, 2025. The proposed acquisition is expected to be completed in RLEB’s financial year 2025.
Maxflo is principally involved in providing products and services for exploration, drilling and well intervention, enhanced oil recovery/improved oil recovery and production technologies specifically for offshore and onshore oil and gas, refining, chemical and petrochemical.
RLEB group is engaged in four business segments: (1) oil & gas related and other activities (developing and providing oil & gas well related services, production enhancement services and sand management solutions, (2) renewable energy and related activities (providing renewable energy activities and related business), (3) wastewater treatment services (provision of wastewater treatment services as well as EPCC (engineering, procurement, construction and commissioning) of wastewater treatment plant and related infrastructure) and (4) investment holding and other services (investment holding, and supply of technical personnel and providing consultancy).
RLEB said the initial acquisition of 30 per cent stake in Maxflo by RLSB is to enable the group to tap into the Middle East market via Maxflo’s established relationship with overseas customers in Saudi Arabia and Bahrain as well as extensive expertise, such as enhanced oil recovery and improved oil recovery technologies.
The move further strengthens the group’s competitive position in the region.
“Further, Maxflo will serve as RLEB’s strategic launch pad for expansion into key Middle East market, specifically the United Arab Emirates, Oman and Qatar,” it said.
“From a tendering standpoint, the synergy resulting from full ownership of Maxflo is expected to enhance competitiveness and standing in tenders issued by Saudi Aramco and SLB.”
RLEB said the proposed acquisition of the remaining 70 per cent stake in Maxflo will also allow the group to establish a cost-effective supply chain through strategic resource integration, including the cross-border sharing of manpower.
Notably, it said, most of Maxflo’s crew members in Saudi Arabia are sourced from countries within the Gulf Cooperation Council, Pakistan and India.
These personnel can be rotated into Malaysian operations, and vice versa, allowing for better workforce utilisation and minimising operational downtime.
This integrated manpower model supports greater operational flexibility and long-term cost efficiency.
RLEB said by acquiring the entire stake in Maxflo allows for the full consolidation and control over Maxflo’s financial performance, business operations and future direction.
For financial year ended June 30, 2025, Maxflo recorded revenue of RM16.74 million and net profit of about RM1.61 million.
Maxflo is currently participating in project tenders with a total estimated value of US$12.73 million for a period of three years, which, if secured, will further enhance its offer book and earnings potentials, said RLEB.
On the prospects of the group, RLEB said its involvement in the renewable energy space aligns with Malaysia’s National Energy Transition Roadmap, particularly as it has been selected, alongside Sumitomo Corporation and Maqo Engineering as a solar power producer under the Corporate Green Power Programme.
The programme is a renewable energy initiative that allows corporate consumers to virtually purchase solar energy from solar developer.
RLEB sees the programme as potentially to provide new opportunities for the group in sustainable energy sector.
“Further enhancing its renewable energy portfolio, RLEB group could also potentially benefit from Malaysia’s 5th Large Scale Solar (LSS), known as ‘LSS Petra” which offers 2,000MW of capacity as part of Malaysia’s commitment to achieving net-zero carbon emissions by 2050,’ it added.
“RLEB group intends to provide their support services as a sub-contractor for the EPCC services to the successful bidder that was awarded the contract under the LSS.”
“As the energy landscape continues to shift, RLEB group is well-positioned to benefit from both traditional and renewable energy opportunities. The number of wells to be drilled is expected to rise slightly in 2025, whereas plugging and abandonment activities are expected to dip in 2025 before rebounding from 2026 onwards.
“For the next three years, decommissioning plans include the plugging and abandonment of approximately 152 wells and the abandonment of about 37 offshore facilities and one onshore facility relating to the section of Sabah-Sarawak Gas Pipeline.
“RLEB is actively participating in decommissioning tenders and is well-positioned to secure a portion of the upcoming works, leveraging its proven well intervention expertise.”
RLEB said the group remains committed to pursuing new tenders in both the oil & gas and renewable energy sectors, and is cautiously implementing business strategies that align with market trends so as to achieve sustainable growth.
