Singapore's Ezra Holdings files for United States bankruptcy

Cornelia Mascio
Marzo 20, 2017

Singapore's government late past year introduced measures to boost marine and offshore engineering companies' access to working capital, including providing loans to eligible firms.

Ezra shares last traded on March 15 at an all-time low of 1.1 cents, down 77.6 per cent this year, while Triyards shares finished at 28.5 cents last Friday, dropping 1.7 per cent from Thursday's close.

Industry peers Swiber Holdings Ltd and Swissco Holdings Ltd have already sought refuge in court, while auditors have questioned the future of Nam Cheong Ltd.

CIMB head of research Lim Siew Khee said it was likely that the banks' exposure to Ezra exceeds their exposure to Swiber Holdings, which filed for judicial management here in July a year ago.

Ezra announced on Sunday that it had filed for bankruptcy protection under Chapter 11 of the US Bankruptcy Code to facilitate its financial restructuring.

The company said it had loans of US$272 million (S$380.8 million) owed to Singapore lender DBS Group and US$184 million owed to Oversea-Chinese Banking Corp. Its subsea services affiliate Emas Chiyoda Subsea Ltd filed for bankruptcy earlier.

DBS in a statement said, "Our exposures to Ezra Holdings were moved to non-performing in the third quarter, and suitable provisions have been made".

Documents showed Ezra has declared estimated assets of between US$500,000 (S$699,000) and US$1 billion against estimated liabilities of between US$100 million and US$500 million. OCBC and UOB said they have made provisions for vulnerable accounts in the sector. "At this point in time we have no knowledge of how much of the assets could be written down".

"The company is therefore now seeking advice on the Ezra Chapter 11 Filing, as well as assessing the impact of such filing on the group and on the group's ongoing initiatives to refinance its financial obligations and liabilities and the procurement of additional working capital facilities", it said.

"I expect the recovery prospect for Ezra's bondholders could be pennies on the [US] dollar under the USA bankruptcy process", said Kurt Metzger, a Singapore-based director at GEM Advisory, a debt-restructuring consulting firm. Ezra said it would meet noteholders as soon as is practicable.

The maturities peak in 2020, when S$11.2 billion comes due, the most since 2012, according to data compiled by Bloomberg.

Beleaguered Ezra Holdings called for trading in its shares here to be suspended yesterday - a day after it filed for bankruptcy in the US.

Altre relazioniGrafFiotech

Discuti questo articolo

Segui i nostri GIORNALE