PM: RM1.1 billion funding to Sapura Energy is a loan, not grant

PRIME Minister Datuk Seri Anwar Ibrahim has clarified that the RM1.1 billion funding provided to Sapura Energy Bhd (SEB) is a loan, not a capital injection, and will need to be repaid once the company starts generating profits.

Speaking at the Finance Ministry’s monthly assembly today, Anwar explained that the funds are intended to support SEB’s new management in improving operational efficiency. The aim is for SEB to return to profitability and eventually repay the loan.

Anwar, who also serves as Finance Minister, said this following a statement made on Monday when SEB secured the RM1.1 billion investment from Malaysia Development Holding Sdn Bhd (MDH) through a subscription of the company’s nominal value of redeemable convertible loan stocks (RCLS).

SEB announced that the funding agreement was part of its broader financial restructuring efforts.

“The RM1.1 billion funding provided to Sapura Energy Bhd is specifically for settling SEB's debts with vendors, including 2,000 local oil and gas vendors, the majority of which are Bumiputera companies,” Anwar stated during the assembly.

“This funding is a critical part of SEB’s restructuring process, designed to assist and rescue local workers who have not been paid for their services for an extended period. It is also vital for preserving the local oil and gas industry ecosystem.”

Anwar emphasised that the capital infusion does not benefit SEB’s shareholders or management.

“In the restructuring process, previous major shareholders are no longer involved in SEB’s management. A new, professional management team has been appointed to carry out the restructuring,” he added.

Regarding the funding process, Anwar also highlighted that an audit had already been completed, with additional due diligence to be carried out as a prerequisite for finalising the restructuring and capital injection.

The findings from this due diligence will be shared with relevant enforcement agencies such as the Securities Commission to determine if any further action is required.

“Rest assured, the MADANI Government continues to prioritise transparency and good governance in its management. The SEB restructuring has received approval from creditors and has gone through the court process,” Anwar reiterated.

“This funding from the government is not a grant, but an investment aimed at revitalising the strategically important oil and gas ecosystem for the nation’s economy.”

Yesterday, Unity Government spokesman Datuk Fahmi Fadzil also clarified that the funding was neither a bailout nor a capital injection, but rather a strategic investment intended to stabilise SEB and safeguard the broader oil and gas industry. – March 13, 2025