The Singapore High Court has appointed an interim judicial manager for oilfield services company Swiber Holdings.
KPMG's Mr Bob Yap, its head of deal advisory in Asia-Pacific and head of advisory in Singapore, has been appointed the interim judicial manager, sources told The Straits Times. Mr Yap's task will be to preserve the status quo of the company until the outcome of its application.
Under judicial management, Swiber will be able to continue operating under court supervision while attempting to turn around the business.
The debt-ridden group, which faces US$50.5 million (S$68 million)in letters of demand, dropped its plans to wind up and liquidate itself, opting instead to apply for judicial management.
It also defaulted on a coupon payment due yesterday.
About 15 creditors showed up for the hearing yesterday, including DBS and UOB, sources said.
DBS has a total exposure of about $700 million to the Swiber group of companies, while UOB has said its exposure is "manageable".
DBS in fact made two loans to Swiber totalling US$146 million weeks before the company filed for liquidation, according to court documents, Reuters said yesterday.
Swiber used the money to redeem maturing bonds, an affidavit filed by the company's chairman Raymond Goh showed.
A creditor, who declined to be named, told The Straits Times that the court said it will be looking closely into Swiber's cash flow management to assess if the company had been imprudent or overly ambitious with its resources before ruling on the application.
"I knew Swiber was having cash flow problems, but I also knew they had business," said the creditor, adding that news of its insolvency had come unexpectedly.
"The banks should have known who they are lending to, the risks, instead of giving in to this knee-jerk reaction. It doesn't help because the whole industry is down."
The High Court earlier had fixed a judge pre-trial conference for Friday. This is usually to give directions on the next course of action as well as updates on the judicial management application.