KUALA LUMPUR (Dec 27): Perisai Petroleum Teknologi Bhd surged 40% this morning after the company and Emas Offshore Ltd (EOL) came to a settlement on their dispute over the disposal of Perisai’s 51% stake in SJR Marine (L) Ltd to EOL.

At 9.05am, Perisai rose 2 sen to 7 sen with 14.36 million shares traded.

Last Friday, Perisai said it has entered into a settlement agreement with EO, to achieve a full and final settlement arising from or in connection with the share sale agreement (SSA) dated Nov 30, 2012 and put option.

To recap, EOL had intended to terminate the agreement with Perisai after Perisai had tried to exercise its put option following a lapse in the right to the call option by EOL.

EOL and Perisai mutually agreed to a consideration of US$43.03 million of the put option shares to be satisfied by EOL. This would comprise US$20 million in cash on the completion date and US$23.03 million in a deferred payment amount.

Upon completion of the agreement, Perisai will receive partial settlement of the consideration of US$20 million (RM89.51 million), which is crucial to ensure the success of its debt restructuring plan, and as general working capital for operational, corporate and restructuring expenses.

The partial settlement of the consideration of US$20 million will be paid by EOL through its bank borrowings.

Following completion of the sale of the put-option shares, SJR Marine will no longer be part of Perisai Group and this is consistent with the Perisai Group's plan to exit the offshore construction segment.

The proposed settlement agreement is expected to be completed by the third quarter of 2017.