KUALA LUMPUR: UMW Holdings Bhd (UMW) is exiting the oil and gas (O&G) sector to refocus on its core businesses of automotive, equipment and manufacturing & engineering.It said on Thursday the exit from oil & gas would begin with the proposal for the “distribution in specie” of all its shares in UMW Oil & Gas Corporation Bhd (UMW O-G) to all entitled UMW shareholders by the second quarter of 2017.UMW explained the decision to exit the O&G was to enable it to focus on the better long-term growth potential.“Concurrently, UMW O-G is also proposing to lead the oil & gas industry consolidation,” it said. This distribution exercise will be followed by a progressive exit of non-listed oil & gas assets held by UMW, a process that started five years ago. “In pursuing this, for the other non-listed oil & gas assets, UMW may have to impair such investments, the details of which are being assessed as part of the annual audit impairment testing exercise. UMW said the proposed distribution would be via a proposed bonus issue and proposed redemption. “A strategic exit from oil & gas will allow the company to strengthen its financial position and reallocate its resources towards investments that we believe have the best potential for growth.

Source: The Star January 19, 2017 11:25 UTC