Medserv — Proposed share exchange for Regis Holdings

MedservRegis (MSE: MDS)

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Research: Industrials

Medserv — Proposed share exchange for Regis Holdings

The Medserv board has announced that a conditional agreement has been reached with Regis Holdings Limited, based in Mauritius, to effect a strategic transaction through a share for share exchange with a value of €32.5m. The deal should provide Medserv with market access into critical growing markets and should strengthen its equity base and liquidity position. The deal is subject to Medserv shareholder approval at a general meeting. More details including financial outlooks for FY21 and FY22 for the expanded Medserv plc are to be provided in a shareholder circular in advance of that.

Andy Chambers

Written by

Andy Chambers

Director, Industrials



Proposed share exchange for Regis Holdings

Potential strategic transaction announced

Industrial support services Sector

12 April 2021



Market cap



Adjusted net debt* (€m) at 30 June 2020
*excluding leases


Shares in issue


Free float




Primary exchange

Malta SE

Secondary exchange


Share price performance

Business description

Medserv is a Malta-based provider of integrated offshore logistics and services in support of drilling operations in the Mediterranean, MENA and South America. The acquisition of the METS companies in February 2016 diversified the company into onshore steel tube stockholding and servicing for countries in the Middle East and beyond.


Andy Chambers

+44 (0)20 3681 2525

Medserv is a research client of Edison Investment Research Limited

The Medserv board has announced that a conditional agreement has been reached with Regis Holdings Limited, based in Mauritius, to effect a strategic transaction through a share for share exchange with a value of €32.5m. The deal should provide Medserv with market access into critical growing markets and should strengthen its equity base and liquidity position. The deal is subject to Medserv shareholder approval at a general meeting. More details including financial outlooks for FY21 and FY22 for the expanded Medserv plc are to be provided in a shareholder circular in advance of that.

Year end

Revenue (€m)



































Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.

Regis Holdings is a holding company whose subsidiaries included in the transaction provide logistics, equipment, procurement and specialised services to a wide range of customers primarily in the energy, drilling and mining industries. It also supplies product and equipment manufacturers and other heavy industry-related contractors in South Africa, Mozambique, Uganda, Tanzania and Angola. It extends the presence in Africa and adds complementary services for clients to Medserv’s existing shore base logistics and OCTG offerings. Other current subsidiaries of Regis, mainly in property, are to exit the company in a reorganisation before the deal executes.

If approved, the deal is to be effected by the issue to Regis shareholders of 47.89m new shares in Medserv at a value of €0.68 per share for a consideration of €32.5m. The transaction essentially purchases operating assets in sub-Saharan Africa and €20m of cash. The newly issued shares represent 47.1% of the enlarged capital of MedservRegis, the proposed new name for the combined entity. In separate agreements with Medserv’s two current major shareholders, the Regis vendors will also acquire an aggregate 2.92m existing shares in Medserv contingent on the deal completing, becoming the major shareholder of MedservRegis with just under 50%. A three-year call option to acquire further holdings from both the existing major Medserv owners is expected on completion which if exercised would initiate a mandatory bid. The free float would reduce to c 19% after the transaction.

Financially the transaction should strengthen the group with combined gross assets of around €170m including cash and cash equivalents of c €25m and gross liabilities of just under €100m including €23m of lease liabilities.

Medserv has yet to publish FY20 numbers but in November said it expected to meet the FAS (Financial Analysis Summary) forecast which was updated in July 2020. The estimate was for sales of €27.1m, EBITDA of €5.5m and a loss before tax of €9.7m. Year-end adjusted net debt (excluding leases) was forecast as €52.6m (FY19 €54.3m). We should restore estimates after management confirms FY20 results and provides more details on FY21 trading prospects.

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