High Court dismisses Ezion bondholder's originating summons


Ezion Holdings said an originating summons taken out by a substantial bond holder has been dismissed by Singapore's High Court.
Ezion Holdings said an originating summons taken out by a substantial bond holder has been dismissed by Singapore's High Court.PHOTO: EZION HOLDINGS

SINGAPORE - Ezion Holdings, which had asked creditors for support to push back debt deadlines, said Friday (Nov 24) an originating summons taken out by a substantial bond holder has been dismissed by Singapore's High Court.

Bond holder Ravi Murarka who owns a substantial share of the liftboat operator's tranche of S$120 million bonds backed by DBS Bank, served Ezion a redemption notice in September, citing the bond clause that he can demand to be paid back in full "in the event that the shares of the issuer cease to be listed or traded".

Mr Murarka's case was the first time that any bond holder had filed a summons against a Singapore issuer to protect his rights as a bond holder.

He sought a court declaration that Ezion's shares had ceased to be traded on the Singapore Exchange (SGX), within the meaning of that clause, after Ezion suspended trading of its shares on Aug 14 this year to discuss a debt reorganisation plan with lenders. Its shares are still suspended.

Ezion had applied to the court to strike out the application on the grounds that the shares had not ceased to be listed or traded, and were only been suspended from trading.

In a pre-market SGX filing on Friday, Ezion said: "The board wishes to update that the Court has granted the company's striking-out application at today's court hearing. Accordingly, the originating summons against the company has been dismissed.

Last week, in a landslide vote, Ezion won bondholders' approval for its proposed refinancing of six series of notes and perpetual securities totalling S$575 million. The DBS-backed bonds were not part of the restructuring.

The successful refinancing of the S$575 million securities was key to unlocking a US$100 million working capital line from the group's senior lenders so that Ezion can mobilise its fleet for work.

Ezion chief executive Chew Thiam Keng said last month that 70 per cent of the company's bonds are held by private banking clients, and the rest with insurers and funds.

He said last week that Ezion still needs support from two other key stakeholder groups - bank lenders and shareholders.