In a surprise move last night, a beleaguered Swiber announced that it was discharging its provisional liquidators and opting to put itself under judicial management.
The move came a day after Swiber shocked the market with the sudden news that it was going to liquidate itself after receiving letters of demand for US$25.9 million (S$35 million).
Mr Cameron Duncan, a partner of insolvency specialist KordaMentha, and Ms Muk Siew Peng had been appointed Swiber's provisional liquidators on Wednesday.
Their task would have been to assess the group's position and take steps to preserve its assets for creditors. Last night, Swiber said the board and the liquidators had had discussions with the company's major financial creditor.
The creditor had indicated it was supportive of an application for judicial management instead of liquidation. Swiber also said separately that its subsidiaries have received further claims. The total sum of claims faced by the group has now risen to US$50.5 million.
With Swiber opting for judicial management instead of liquidation, it would continue its operations under court supervision while attempting to turn around the business.
If it had opted for liquidation, the firm would have been wound up and its assets sold to repay creditors.
Observers said that under judicial management, there is a higher chance of recovering more money for the creditors - than under the liquidation method - as operations continue .
Earlier, Mr Duncan told The Straits Times: "It's early days yet. Our appointment applies to the holding company, Swiber Holdings, not its 40 subsidiaries. Our urgent job is to preserve the assets of the group."
Swiber's latest financial statements showed that the company had liabilities of US$1.43 billion as at the end of March.
According to Swiber's annual report, its principal bankers include DBS and UOB among the local banks, and Bank of America Merrill Lynch, Citibank, Deutsche Bank, ICICI Bank, Maybank, RHB Bank, HSBC and Siam Commercial Bank among foreign lenders.
At Swiber's building at International Business Park yesterday, most employees said they were not aware of the company's woes before news of its liquidation broke.
An employee of over a year said: "We don't have any updates. We'll just have to see what happens."