Shares of ES Group (SGX:5RC) surged 8% on Wednesday after the offshore engineering company's subsidiary, ES Aspire, signed a binding memorandum of agreement to dispose of its 8,028 deadweight tonnage steel tanker to an unrelated third party.

The unnamed buyer, who is involved in marine services and consultancy for regional tankers market, will pay a consideration of about $4.8 million for the Singapore-flagged vessel, according to a Tuesday filing with the Singapore Exchange.

The disposal is expected to conclude before June 10.

The transaction will allow the company to reduce its exposure to maintenance costs and to redeploy capital to its core business activities such as new building and repair segment, the filing said.