Don't know if I have mentioned this before with regards to SGX listed offshore support plays... its all a big concept.
Remember Tan Kim Seng - the man that made a lot of money selling his original flagship KS Energy to Indons?
KS Energy used to hold a strategic stake in Ezra or vice versa.
The early days of Ezra was touted as one of high growth companies that will benefit from a young fleet and deep sea exploration.
If I remember correctly, both Ezra and KS Energy booked substantial gains from sale of equity stakes prior to GFC. Pre GFC days saw gush of liquidity chasing "growth" disregarding operating cash generations.
Of course, commodity prices continued to be sustained at high levels post GFC on China pump priming to shield against effects of GFC and that of QE.
Unfortunately, after Tan cashed out of both KS Energy and Ezra pre GFC - this is when Ezra start to lose its concept with the delivery of its modern equipment.
Personally, I find that subsequent contract wins and even another bolt on purchase in Norway is highly questionable. Ezra's order books have always been in the billions but year after year there is hardly any results to show for and Ezra kept issuing debt papers after papers.
Then came the mysterious rise of Ezion - formerly known as Nylect Engineering - another vehicle by Tan. Ezion's model look questionably similar to that of Ezra except that it is focusing on another segment of the offshore industry. It is also another growth stock.
I do not follow Ezion very closely but from the little that I know, it is quite similar except that cash generation is better and there are accounting profits to show for. Of course, Ezion also have similar debt instruments but there are more strategic holders that are well known to the markets. Sometime last year, research house csfb started questioning the age of the fleet that Ezion has purchased - 30 year olds being touted as growth stories and that started the downfall of Ezion that coincided with the steep decline in oil prices.
In fact round about the same time, Tan is also involved in another new offshore play - Swissco.
Midas touch or not - it is for us to evaluate over time. To me the ultimate winner from all this offshore concept - Tan and his partners that seeded these plays over time.
(31-05-2015, 06:37 PM)Musicwhiz Wrote: [ -> ]The thesis for Ezra hasn't changed much since I divested the Company back in 2009. It looks like it still manages to come up with financial engineering techniques in order to prolong the tenure of its debt. Not a single cent of free-cash-flow generated in the time I held it, till now (and that's 2005 till now).
).