SINGAPORE - Vallianz Holdings and several of its subsidiaries entered into a framework agreement with their lenders on Friday (March 10) to refinance some of the group's existing borrowings totalling US$163.2 million (S$231.6 million).
Under the agreement, the profile of the borrowings with the lenders have been restructured to a repayment term of about 8.2 years, up from an average of some 5.8 years previously,
The maturity of these borrowings have been extended to December 2022.
This is subject to the group granting the lenders a shared security package over the shares of certain Vallianz subsidiaries and fixed assets of the group.
The completion of this debt restructuring exercise will result in a deferment of the repayment of the principal amount of borrowings owing from the group, thereby relieving its cash flow by US$103.5 million in the next two years.
This will enhance the group's short-to-medium term liquidity position and cash flows.
"The successful completion of the debt restructuring exercise will better position the group to withstand the market slowdown and move forward on a stronger financial footing," said Vallianz chief executive Ling Yong Wah in a statement.
Rawabi Holding Company, a controlling shareholder of Vallianz, was similarly relieved.
Rawabi group chairman Sheikh Abdulaziz AlTurki said the debt structuring exercise reflects bankers' confidence in the Vallianz group's ability to weather the current difficult market conditions.
"I believe Vallianz's excellent service quality and its proven operational capabilities in supporting customers' oilfield activities will enable the group to remain competitive and sustain a leading position in its main market in the Middle East," he noted.
Vallianz shares today ended unchanged at two cents.