Pacific Radiance executive chairman Pang Yoke Min, a substantial shareholder of beleaguered Swiber Holdings, sold over three million Swiber shares just days before the company filed to wind up.
Mr Pang offloaded around 3.1 million shares from July 12 to 25 for $476,477.59, according to a filing to the Singapore Exchange (SGX) late on Wednesday. This translates to a sale price of about 15.6 cents a share.
Swiber announced on July 28 that it had applied to liquidate the business before filing the next day to be placed under judicial management. The group is facing claims from creditors that have ballooned to about US$99 million, (S$133 million) compared with US$4.76 million at its first disclosure. The stock last traded at 10.9 cents on July 27, before trading was suspended.
Mr Pang said in the filing - in response to SGX queries - he did not report the sale as he had been told by his financial adviser that at least a one percentage-point change in shareholding required reporting.
"I owned 47,271,010 shares (representing 10.27 per cent of the issued share capital in Swiber) prior to the sale," he said. "Subsequent to the sale, I own 44,211,510 shares (representing 9.6 per cent). The amount sold represents 0.67 per cent of the total shares, that is, less than the 1 per cent threshold."
Under the Monetary Authority of Singapore's Securities and Futures Act, a substantial shareholder of a company, or one who owns 5 per cent or more in stock, must report any change in the percentage level of the interest within two business days.
"If you look at the post-disposal percentage level of interest, when rounded down, and compare it with the pre-disposal percentage level of interest, when rounded down - if the numbers are different, the change should be reported," said Mr Koh Junxiang, associate director at law firm Clyde & Co.
The group's other substantial shareholders as at March 14 included the company's chairman, Mr Raymond Kim Goh, who holds 16.09 in direct and deemed interest, according to Swiber's latest annual report. Swiber group chief executive Yeo Chee Neng has a total shareholding of 17.46 per cent, while Newshire Capital holds 15.24 per cent in direct interest.
Pacific Radiance, which owns and operates offshore vessels and provides subsea services to the oil and gas industry, has said it expects to make a provision of about US$10.1 million in relation to "doubtful receivables" from services rendered to Swiber, and that its full-year financial results will take a hit.
But the company also said on Wednesday said that Swiber's fallout will not affect its cash flow, reassuring investors it has the full support of its lenders, partners and banks. It added that it "will continue to pursue all legal avenues of recovery of the doubtful receivables", while stressing it runs a business quite different from Swiber's.