SINGAPORE - Ailing Malaysian shipbuilder Nam Cheong has confirmed that it will default on the $2.25 million coupon and $90 million principal owed to the holders of its Series 002 bonds on Monday (Aug 28).
Nam Cheong will also fail to pay the $5 million coupon owed to holders of its $200 million Series 003 bonds, which is due on Saturday (Aug 26).
Although these bonds are secured by deposits equivalent to two coupon payments each for the Series 002 and Series 003 bonds which are held in an escrow account by DBS Trustee, the company is still in communication with DBS Trustee, Nam Cheong said in a bourse filing on Tuesday (Aug 23).
However, Series 004 bond holders have been slightly more fortunate. Nam Cheong said that it had on Aug 1 paid the coupon owed to holders of its $75 million Series 004 bonds.
This amount - $2.44 million originally due on July 23 - had been paid out of the deposit in the escrow account for the Series 004 bonds.
Separately, an informal steering committee comprising nine bondholders has been formed to facilitate meetings with Nam Cheong. Rajah & Tann has been engaged to advise this committee.
Nam Cheong said it intends to hold discussion groups with bondholders commencing this week.
Trading of Nam Cheong shares were suspended last month, after it said it wanted to "temporarily cease" all debt repayments in a final bid to conserve cash and avoid liquidation.