KUALA LUMPUR (Aug 24): Genting Hong Kong Ltd (GENT HK), which has suspended payments to creditors, will hold its first creditors’ meeting at 5pm today to restructure its debts.
In a filing with the Stock Exchange of Hong Kong, GENT HK chairman Tan Sri Lim Kok Thay, who is also the chief executive officer (CEO), said in the virtual meeting the cruise ship operator will present and discuss an orderly process to reach an agreement with respect to a solvent, consensual and inter-conditional restructuring solution for the group.
Meanwhile, Lim announced that the group had settled the bank fees, which were fees and charges based on pre-existing terms.
Lim, who controls a 76% equity stake in GENT HK, stressed that where the board considers it to be in the best interest of all stakeholders, the board shall consider paying interest and charter payments as they fall due based on pre-existing terms.
To recap, GENT HK last Thursday announced that it had opted to temporarily suspend payments to all creditors in order to preserve as much liquidity as possible, fulfil the board’s fiduciary duties, and treat all its financial creditors fairly and equitably.
Its share price took a nosedive last Thursday, down 37% to an all-time low of HK$0.30 (16 sen). It closed at HK$0.315 last Friday.
GENT HK revealed that it had mandated certain financial institutions as funding advisors to arrange a fundraising exercise.
"The funding advisors delivered a report on parties interested in the fundraising exercise to the board of directors of the company on Aug 19, 2020.
“The board has been informed that the group and potential interested parties will require more time to assess the provision of additional funding to the group. There is currently a lack of certainty as to the outcome of the fundraising exercise,” said GENT HK last Thursday.
The temporary payment suspension came two weeks after the cruise operator issued a profit warning on substantially higher losses for the six-month period ended June 30, 2020.
“The operating loss and unaudited consolidated net loss of the group for the six months ended June 30, 2020 are expected to be not less than US$300 million (RM1.25 billion) and US$600 million respectively, as compared to an operating loss of US$38.3 million and an unaudited consolidated net loss of US$56.5 million for the corresponding period in 2019,” Lim said in a filing dated Aug 3.
The Covid-19 pandemic has had and will continue to have a material impact on the financial position and operating results of the group, Lim said in the profit warning.
Edited by Kathy Fong