KUALA LUMPUR (Aug 31): Genting Hong Kong Ltd (GEN HK) announced the resignation of its controlling shareholder’s son Lim Keong Hui from the board. Keong Hui is the son of Tan Sri Lim Kok Thay, who is the group’s single largest shareholder holding a 76% equity stake.
According to a filing with the Hong Kong Stock Exchange last Friday, Keong Hui stepped down as the executive director and the deputy chief executive officer of GEN HK effective Aug 28, 2020 to devote more time to other business commitments.
“Mr Lim (Keong Hui) has confirmed that he has no disagreement with the board and there is no matter in relation to his resignation which needs to be brought to the attention of the shareholders of the relation to his resignation which needs to be brought to the attention of the shareholders of the company,” said the filing.
Coincidentally, the resignation came one day after Kok Thay was redesignated as the executive deputy chairman of Genting Malaysia Bhd (GENM), which operates the hilltop casino in Genting Highlands plus casinos in the UK and US. Keong Hui is currently the deputy chief executive and executive director of GENM.
GEN HK, which announced a whopping net loss of US$742.59 million for the six months ended June 30, is confident of having sufficient capital to fulfil its financial obligations in the coming 12 months should its efforts, such as cutting costs plus capital expenditure and raising fresh capital, bear fruits.
The cruise ship operator said in its result release that its directors are in the process of seeking additional equity or debt funding from private investors and have received indicative letters from the investors, expressing interest to invest in one of the group’s cruise brands.
“The directors are in discussion with the investors on the terms and conditions of the funding and consider that there is a reasonable prospect that the group will be able to obtain the funding within the next 12 months from June 30, 2020,” said GEN HK in the filing.
GEN HK stepped into the limelight after it revealed that it opted to suspend all payments to creditors to preserve cash. Its share price then dropped to an all-time low of HK$0.29.
As at June 30, the group’s total loans and borrowings amounted to US$3.26 billion compared with US$2.739 billion as at Dec 31, 2019. The loans that are repayable within a year amounted to US$200.4 million.
Nonetheless, Gen HK’s board of directors is hopeful that the cruise operator will be out of rough waters given the efforts it is making to revive its financial health.
The group anticipates that the cruise operations will resume from January 2021.
Besides raising fresh capital, GEN HK said it is in the process of applying for long-term funding from the Economic Stabilisation Fund (WSF) from the German federal government to sustain its shipyard operation in Germany. The WSF was set up for the objective of reducing the damage caused to the German economy by Covid-19. Its shipyard operation bled gross loss of US$180.15 million.