Oil exploration and production firm Loyz Energy yesterday announced plans to diversify its business into fund management, investment and trading.
In a pre-market filing, the Catalist-listed company said it had entered into a binding memorandum of understanding (MOU) with Arctos Investments, a multi-asset investment firm, to form a joint venture that will focus on fund management, investments and trading.
The company, to be named FIT Global (FIT), will have an issued and paid-up capital of $1 million, to be borne entirely by Loyz Energy in cash. Arctos Investments will contribute by way of its network, team of investment and trading professionals, and risk management expertise, said the statement.
As part of Arctos Investments' contribution, Loyz Energy will issue new ordinary shares in its capital at an issue price to be agreed, amounting to $1 million, to Arctos.
FIT's main business activities will be:
- Investment, including private equity deals, pre-initial public offerings (mature stage), initial public offerings, fixed income and hybrid instruments;
- Trading, including the trading of equities, commodities and other financial instruments, including cryptocurrencies;
- Fund management; and
- Market making for commodities.
Loyz Energy chief executive and executive director Jeffrey Pang said: "Through our efforts in streamlining non-performing oil and gas assets, the group is left with our 20 per cent stake in the producing onshore oilfields in Thailand... We are entering into a new business to augment our income and cash flows, and partnering with Arctos Investments, which has a good team of experienced investment professionals, will give us an immediate boost in our new business initiative."
He added that Mr Wong Yat Foo, an investment veteran "with a strong track record", will lead the team in the strategic collaboration.
He said: "We expect to work towards expanding the group's earnings base with stable income through fund management fees from the proposed joint venture and potential gains from managed investments and trading in the markets."
Arctos Investments will assist FIT with the application for a fund management licence to the Monetary Authority of Singapore.
The company will be seeking approval from its shareholders for the proposed business diversification at an extraordinary general meeting to be convened.