Swiber applies to place company under judicial management instead of liquidation

Swiber has applied to discharge the provisional liquidation order and to withdraw the winding up application made on July 27, 2016.
Swiber has applied to discharge the provisional liquidation order and to withdraw the winding up application made on July 27, 2016.ST PHOTO: MARCUS TAN

SINGAPORE - Offshore marine group Swiber Holdings on Friday (July 29) took out an application to place itself and its subsidiary Swiber Offshore Construction (SOC) under judicial management and interim judicial management.

It had announced its winding-up application on Thursday (July 28), sending shock waves through the market.

Swiber said that on Thursday, the directors and the provisional liquidators had discussed with the company's major financial creditor, who indicated it was supportive of an application for the company to place itself into judicial management instead of liquidation.

On Friday, Swiber applied to discharge the provisional liquidation order and to withdraw the winding up application made on July 27.

While Swiber did not name the major financial creditor, market observers speculate that it could be DBS Bank given its $700 million exposure to the company.

Judicial management - a court-supervised process - seeks to rehabilitate potentially viable companies. A court-appointed official, or a judicial manager, would take over the duties of the directors; and claims against the company would be frozen to give him room to revamp the company's affairs.

In comparison, winding up or liquidation is perceived as a last resort and the amount recovered for creditors is often less.

Swiber also made clarifications on earlier announcements regarding resignations. Mr Tay Gim Sin Leonard remains as group chief financial officer, it clarified.

Mr Tay, along with Mr Francis Wong Chin Sing, who resigned as group vice chairman, and Mr Nitish Gupta, who resigned as a director of the company, continue to remain as directors of certain subsidiaries of the company, it added.

The group noted as well that it has, together with its subsidiaries received further claims totalling about US$24.6 million.

As at Friday, the total sum of claims received by the group is about US$50.5 million.

"The company is currently seeking legal advice on the claims received by it and will make further announcements as and when appropriate," it said.

wrennie@sph.com.sg