Pacific Radiance shares will start to trade this morning with an IPO price of $0.90 and an indicative market cap of S$653.2M. Capital raised from this IPO will be used to fund the expansion plans of the company. Investors who are looking to take a leveraged position over the company may do so via the newly listed Macquarie warrants which will start to trade at around the same time as the IPO shares.

Pacific Radiance owns and operates offshore vessels which support the needs of an oil and gas field’s project life cycle. The company stated in its IPO prospectus that it believes in being relevant to their client’s needs, reliable in their service delivery and execution as well as being responsive to trends in the industry.

The following excerpts were taken from the IPO prospectus of Pacific Radiance.

Pacific Radiance outlook for the industry:
- Positive outlook for the subsea sector as well as oil prices
- There are excellent development prospects in Asia, Africa and Australia. In South and Central America, there could be continued growth
- National and international oil and gas companies prefer younger vessels on long-term charters

Pacific Radiance edge includes:
- Owning a young and diverse fleet of offshore vessels
- Having strategic partnerships in cabotage-protected markets like Indonesia and Malaysia
- Management team within the company is experienced with established track record
- Proven track record which showed that the company’s fleet size grew from 50 to 124 in two years. Also, profit after tax and minority interest made US$32.2M in FY 2012 up from US$14.8M in FY2010. 

Pacific Radiance plans for the future
Pacific Radiance has big plans for the future. They intend to expand the fleet they have by capturing opportunities in new and existing markets. Besides expanding operationally, the company is seeking to form partnerships via joint ventures, mergers and acquisitions. These steps will help strengthen their market position.

In addition to capturing more market share, Pacific Radiance will work on having faster response time and more importantly improving profit margins so as to benefit shareholders.

Source: Macquarie Research - 13 Nov 2013