Sapura Energy Berhad today announced that the High Court of Malaya at Kuala Lumpur has granted the Company and 22 of its wholly-owned Subsidiaries (collectively, the "Applicants") Orders under Sections 366 and 368 of the Companies Act 2016. The Orders were obtained today.
The Order under Section 366 of the Act will enable each Applicant to summon meetings with its creditors, to consider and approve a proposed scheme of arrangement and compromise as part of the debt restructuring plan of Sapura Energy Berhad and its subsidiaries (“the Group”).
The Applicants were also granted a Restraining Order pursuant to Section 368 of the Act to restrain and stay legal proceedings against them. The Restraining Order will help each Applicant to engage with creditors without being disrupted by the threat of litigation. The Restraining Order is effective for a period of three months from the date it was granted.
The proposed schemes of arrangement, if approved by the creditors and sanctioned by the Court, will enable the Group to carry out its proposed debt restructuring and provide a framework for payment to our creditors.
Group Chief Executive Officer Datuk Anuar Taib explained, “We acknowledge that the past few years have been a difficult period for all of us, and this exercise may initially give rise to more uncertainties for our clients and creditors. However, with the support of all business partners, this will allow us to create a stable platform for us to come up with a fair and equitable solution for all.”
Sapura Energy is still navigating the impact of COVID-19 on its operations, which had resulted in soaring additional costs and delays in project execution. Its turnaround efforts are also hampered by liquidity concerns.
Datuk Anuar said the scheme of arrangement process represents the best long-term solution for the Group to address its liquidity challenges, in line with its Reset plans. Sapura Energy had announced in December the establishment of a Board Restructuring Task Force that will draw up Reset plans to strengthen the Group’s balance sheet, improve the Group’s financial framework, streamline the Group’s operating model and chart future business direction.
“We will continue to safely execute projects in our orderbook, to ensure clients can unlock value from their oil & gas assets and we can generate work for our vendors,” said Datuk Anuar. “Our end goal is to turn around Sapura Energy and secure a sustainable future for the benefit of all.”
The Group is committed to continuously engage with creditors, clients, partners and shareholders in relation to the proposed debt restructuring and will be reaching out to these stakeholders as soon as possible.