Penguin International Limited Completes Strategic Acquisition of PT LA Engineering

Key Highlights of the Acquisition

• Acquisition Completion: Penguin International Limited (“Penguin” or “the Company”) announced that its subsidiaries, PT Maju Batam Shipyard and PKS Shipyard Pte. Ltd., completed the acquisition of 100% of PT LA Engineering (“PTLA”) on 30 April 2026.
• Strategic Asset: PTLA owns a substantial waterfront industrial land parcel in Tanjung Uncang, Batam City, Indonesia, totaling 13.8464 hectares, comprising two designated locations with all associated licences and permits.
• Purchase Price: The sale was concluded for S\$5,600,000.
• Land Reclamation Commitment: By mid-October 2026, an agreement will be entered with PT Ling Ann Engineering to reclaim 6.6164 hectares of the land at a cost of up to S\$6,823,000, including permit procurement.
• Valuation: An independent valuation places the land and assets (workshops, main office, warehouse) at IDR 153,931,000,000 (~S\$11,489,103).
• Capital Expenditure: As of 30 April 2026, Penguin has paid S\$2,400,000 for new workshop structures and cranes, as part of yard infrastructure development.
• Total Investment Outlay: The aggregate investment in this acquisition is expected to reach S\$14,823,000, factoring in purchase price, capital expenditure, and reclamation costs.

Details Investors Should Know

• Business and Liabilities: PTLA has terminated or novated all prior business operations, liabilities, and contracts, except for select employment contracts and two business contracts. The sellers will manage the remaining employment agreements and assume all obligations under the remaining business contracts, ensuring the purchasers do not inherit any pre-existing liabilities.
• Non-Disclosable Transaction: None of the relative figures under Rule 1006 of the SGX Listing Manual for this acquisition exceed 5%, classifying it as a non-disclosable transaction under Chapter 10.
• Seller Independence: The sellers are independent third parties, not related to Penguin, its directors, or controlling shareholders.
• Rationale and Impact: The acquisition positions Penguin to control rare, sizeable waterfront industrial land contiguous to its existing 4.3-hectare PT Kim Seah Shipyard Indonesia. This strategic move is intended to expand shipbuilding capacity, provide infrastructure for future growth, and free up space for larger, more complex projects at the existing shipyard.
• Growth Platform: The Group will invest progressively in developing the land based on market demand and project pipeline, aiming to increase production capacity while supporting long-term growth.

Potential Price-Sensitive Information

• Rare Asset Acquisition: Securing nearly 14 hectares of waterfront industrial land adjacent to Penguin’s existing shipyard is a significant strategic asset. This could materially affect the Company’s shipbuilding capacity and long-term growth prospects, potentially impacting share value.
• Investment Commitment: The substantial capital outlay (S\$14.8 million) and planned reclamation works signal the Company’s commitment to expanding its infrastructure footprint and operational scale in Batam.
• Capacity Expansion: Investors should note that the acquisition is likely to support increased stock vessel production and larger, more complex projects, which may drive future revenue growth.
• Risk Mitigation: The SPA stipulates that Penguin does not assume pre-existing liabilities, reducing risk exposure from legacy contracts and obligations.
• Inspection Opportunity: Shareholders and interested parties can inspect the sale and purchase agreement at the Company’s registered office for three months, reflecting transparency in the transaction.

Director and Shareholder Interests

• No director or controlling shareholder has any direct or indirect interest in the acquisition, other than through their shareholding in Penguin.

Summary and Outlook

Penguin International Limited has secured a rare, strategic waterfront land parcel in Batam, Indonesia, next to its existing shipyard. The acquisition and planned development provide a platform for expanding shipbuilding capacity and supporting long-term growth. With a total investment outlay of S\$14.8 million, this move positions the Group to respond dynamically to market demand and project opportunities, while mitigating risk by not assuming legacy liabilities. Investors should monitor upcoming developments, as this expansion could drive future revenue and potentially impact share price due to increased production capabilities and long-term infrastructure growth.

Disclaimer: This article is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell shares in Penguin International Limited. Investors are encouraged to conduct their own research or consult with a qualified financial advisor prior to making any investment decisions. The Company’s plans and projections are subject to change based on market conditions and operational developments.

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