Asian Energy Services Stock Plunges on Merger

• AESL to merge with Oilmax Energy (OEPL); OEPL dissolves, assets vest in AESL.
• AESL issues new shares; Oilmax stake cancelled; promoter stake diluted by 46%.
• Post-merger, AESL operates as single entity; expected EPS improvement is 17%.

Shares of Asian Energy Services Ltd. (AESL) are trading over 13% lower on Monday, September 8, after the company's board approved a merger by absorption of Oilmax Energy (OEPL) into itself.

Under the

scheme, OEPL will be dissolved without winding up, and all its assets, liabilities, rights, and approvals will vest in AESL.

As part of the arrangement, OEPL's existing stake in Asian Energy will be cancelled. In return, AESL will issue fresh shares to OEPL's shareholders based on a pre-decided share-exchange ratio.

Oilmax, which currently holds a 66% stake in Asian Energy, will consolidate its interests through this restructuring.

Following the merger, AESL will operate as a single listed entity, combining

the strengths of both businesses. The scheme is expected to be effective within 12 months.

The merger will also result in changes to promoter shareholding. Pre-merger, promoters held around 65% in Asian Energy, which will reduce to about 47% post-merger, implying an equity dilution of nearly 46%.

Financials

	Oil Energy	Asian Energy	Merged
Revenue	128cr	465cr	593cr
EBITDA	71cr	72cr	143cr
PAT	49cr	42cr	91cr

Asian Oil will be diluting equity by 46% to improve merged entity financials.

EPS impact

	Asian Energy	Merged entity
PAT	42cr	91cr
EPS	Rs8.4	Rs9.89
EPS improvement		17%

Shares of Asian Energy Services Ltd. are currently trading 11% lower at ₹344.75. The stock is down over 9%

on a year-to-date basis.