KUALA LUMPUR (April 29): Serba Dinamik Holdings Bhd and its three subsidiaries have been served with winding up petitions from six financial institutions that were involved in providing RM1.2 billion in syndicated term financing.

The subsidiaries are Serba Dinamik International Ltd (SDIL), Serba Dinamik Sdn Bhd (SDSB), and Serba Dinamik Group Bhd (SDGB).

The creditors have appointed Victor Saw Seng Kee, a licenced liquidator of PricewaterhouseCoopers Advisory Services Sdn Bhd, to act as liquidator of Serba Dinamik, SDGB, SDSB and SDIL.

The creditors took legal action after the troubled oil and gas company, which has been embroiled in an audit saga for nearly one year, failed to pay an instalment of RM99 million that was due on Dec 20, 2021.

The company and four senior executives were charged in December last year, accused of submitting a false statement in relation to Serba Dinamik’s record high revenue of RM6.01 billion for the 12-month period ended Dec 31, 2020.

But, early this month, the AGC decided to withdraw the charges following a letter of representation by the accused. The AGC has not publicly explained the rationale for the decision.

According to court documents sighted by The Edge, the finanical institutions that filed the action are AmBank Islamic Bhd, Standard Chartered Saadiq Bhd, HSBC Amanah Malaysia Bhd, MIDF Amanah Investment Bank Bhd, United Overseas Bank (Malaysia) Bhd and Bank Islam Malaysia Bhd.

A winding up petition can be filed by a company’s creditors if the company is deemed to be insolvent, which, if successful, would lead to the liquidation of all of its assets to cover debt obligations.

The court documents said SDGB, SDSB and SDIL were named as the security parties under the syndicated term financing.

The creditors are of the view that Serba Dinamik is unable to pay its debts as per Section 465(1)(e) and Section 466(c) of the Companies Act 2016, taking into account the company’s current, contingent and prospective liabilities.

Besides the default on the RM99 million instalment, the petition was also filed on the grounds that Serba Dinamik could not meet the payment obligations related to RM1.78 billion in syndicated term financing.

These events of default include its failure to meet its payment obligation, failure to submit audited accounts within the extended deadline of Nov 30, 2021, as well as Serba Dinamik’s classification as a Practice Note 17 (PN17) company on Jan 6, 2022.

The petitioners also highlighted that Serba Dinamik had directly and/or indirectly admitted that it is unable to pay its debts including but not limited to the amount due under the syndicated term financing, as evident from the affidavits filed in the application for judicial management filed by SDGB, SDSB, SD Controls Sdn Bhd and SD Development Sdn Bhd.

Citing these affidavits, the petitioners pointed out that Serba Dinamik had previously announced that SD International Sukuk Ltd had defaulted on a US$6.5 million profit payment due on Dec 9, 2021, and that the group had taken out a total of RM2.04 billion in financing from various lenders including the petitioners.

“Serba Dinamik relies on repayment from its own indirect subsidiaries of its intra-group lending to them before it can repay/pay the borrowed/financing sums; however, SDGB, SDSB, SD Controls and SD Development explicitly admitted that they are unable to pay their debts,” said the creditors.

Moreover, the affidavits said that there are at least 91 litigation arbitration and/or adjudication matters against the entities in the Serba Dinamik group, and that the total amount demanded against the entire group is approximately RM108.62 million — excluding the RM1.78 billion acceleration notice amount and the RM99 million instalment sums.

“Additionally, it was admitted that across the Serba Dinamik group, even if there was immediate sale of all assets available for disposal and for which there are said to be purchasers (sale of assets was intended to be over a period of months and, in any event the veracity of such sales is suspect and such claims denied), this would only yield a total of RM157 million.

“This sum is insufficient to make payment of the liabilities under the acceleration notice,” said the petitioners.

Trading in Serba Dinamik’s shares has been suspended since October 2021, after it refused to release the findings of the special independent review by Oct 26, 2021. The counter was last traded at 35 sen, giving it a market capitalisation of RM1.3 billion.

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