17. Investments in joint ventures (cont’d.) Group 2016 2015 RM’000 RM’000 Contingent liabilities Bank guarantees extended to third parties – 85,880 a. The Corporation had on 24 February 2016 entered into a conditional share purchase agreement with E&P Venture Solutions Co Sdn. Bhd., a wholly-owned subsidiary of PETRONAS Carigali Sdn. Bhd., for the equity buyback of the remaining 50% interest in a joint venture, Gumusut-Kakap Semi-Floating Production System (L) Limited (“GKL”), for a cash consideration of USD445,000,000 (RM1,727,489,000). The equity buyback was approved by the shareholders of the Corporation at the Extraordinary General Meeting held on 19 April 2016. Upon completion of the equity buyback on 13 May 2016, GKL ceased to be a joint venture of the Corporation. Accordingly, the Group recognised a loss from remeasurement of previously held interest in the joint venture amounting to RM18,234,000 and a gain on acquisition of a subsidiary of RM823,542,000 in the current financial year. b. AET Inc. Limited, a wholly-owned subsidiary of the Corporation, had on 21 April 2016 entered into a share sale and purchase agreement with Golden Energy Tankers Holdings Corp. for the acquisition of the remaining 50% equity interest in a joint venture, Paramount Tankers Corp., for a cash consideration of USD59,293,000 (RM238,565,000). Upon acquiring full control on 12 May 2016, Paramount Tankers Corp. ceased to be a joint venture of AET Inc. Limited. On 29 August 2016, the final price adjustment was agreed and the acquisition was fully completed. c. The Corporation and its subsidiary, MTTI Sdn. Bhd. (“MTTI”) had on 21 August 2015 entered into an Agreement for the Sale and Purchase of 50% interest in VTTI B.V. with VIP Terminals Finance B.V., ultimately a wholly-owned subsidiary of Vitol Investment Partnership Limited, for the disposal of 50% of the issued share capital of VTTI B.V. for a cash consideration of USD830.0 million (RM3,246,279,000). The disposal was completed on 7 November 2015 and VTTI ceased to be a joint venture of MTTI. The Group recognised a gain on disposal of investment in the joint venture amounting to RM65,317,000 in the previous financial year, as disclosed in Note 4. Details of the joint ventures are disclosed in Note 41. MISC BERHAD • Annual Report 2016 252 notes to the financial statements - 31 december 2016
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