This article first appeared in The Edge Financial Daily on February 12, 2020

*The third paragraph of this article has been amended to correct an error in the original*

KUALA LUMPUR: Businessman Tan Sri Wan Azmi Wan Hamzah and Datuk Mohd Zakhir Siddiqy Sidek are set to emerge as substantial shareholders of Scomi Energy Services Bhd as they have opted to take over the company’s shares pledged against loans extended to Scomi Group Bhd following a default last month.

In a bourse filing yesterday, Scomi Group said it has missed the remedy period to repay Wan Azmi and Gelombang Global Sdn Bhd (GGSB) — Mohd Zakhir’s private vehicle — RM21 million each that Scomi Group borrowed middle of last year.

The two loans were securitised against 870.47 million shares in Scomi Energy owned by Scomi Group which represented an 37.2% stake in Scomi Energy — or 18.6% each for Wan Azmi and GGSB.

The pledged shares valued Scomi Energy at 9.65 sen per share, against its last closing of 5.5 sen per share.

Following the default on Jan 21, each of the lenders had the option to instruct the appointed trustee Malaysian Trustees Bhd (MTB) to dispose of the pledged shares, or to take over the pledged shares and become substantial shareholders, Scomi said.

“On Feb 11, 2020, both Tan Sri Wan Azmi and GGSB have each given notices to MTB to procure the transfer to themselves respectively such number of pledged shares,” the company said.

“The company is seeking legal advice on its next course of action which will be announced in due course,” it added.

Scomi Group had obtained the loans as part of its proposals to reduce its liabilities and improve its capital base, including the reduction of its issued share capital from RM224.96 million to RM3 million and consolidation of every four shares to one.

Just like Scomi Group, Scomi Energy had also defaulted on its financing facilities — RM55 million worth of Series E of the Guaranteed Serial Bonds issued by the latter’s subsidiary.

Scomi Energy had asked to postpone the payment to its bondholders to Feb 28. The bondholders had until Jan 21 to revert, but Scomi Energy has not revealed the outcome of its request.

Shares in Scomi Group closed unchanged at 3.5 sen, valuing the company at RM38.29 million. Scomi Energy shares closed at 5.5 sen with a market capitalisation of RM128.8 million. Both companies are categorised as Practice Note 17 companies.