KUALA LUMPUR: Sapura Energy Bhd and its 22 subsidiaries have been granted an extension of nine months for the convening and restraining orders by the High Court.
The orders, which had initially been granted by the court on March 8 this year pursuant to Sections 366 and 368 of the Companies Act, were set to expire on June 11.
Sapura said the orders would enable each of the applicants to summon meetings with its creditors, consider and approve a proposed scheme of arrangement and compromise as part of the company's group-wide debt restructuring plan.
"The restraining orders will continue to assist the applicants in engaging with creditors without being disrupted by the threat of litigation that could impact the applicants' operations," it said in a statement.
Sapura Energy group chief executive officer Datuk Mohd Anuar Taib said the company was confident that it was now approaching the last few milestones of this journey.
"Our commitment remains – we are determined to protect the value of all our stakeholders in the oil and gas ecosystem," said Anuar.
The extension is necessary for the applicants to finalise the proposed schemes with its financiers and other creditors, following significant progress in negotiations to resolve their unsustainable debt and overdue payables.
Once the proposed schemes are in place, Sapura Energy and its subsidiaries will work towards their next milestone, namely the court-convened meetings which are expected to be held by the end of October 2023.
The primary creditors for Sapura Energy Group are the financiers for its multi-currency financing (MCF) facilities.
The company, along with the other subsidiaries, has engaged with the primary creditors and the Corporate Debt Restructuring Committee (CDRC) to mediate the complex negotiations.
They are working towards reaching an agreement in principle on key items, such as the amount of sustainable debt going forward, divestment options, and the issuance of debt-to-equity financial instruments.
"The proposed restructuring schemes will include a potential financial investment from a white knight of RM1.8 billion, which would further the company's goal to preserve the industry eco-system," said Sapura Energy.
Separately, the CDRC had in February 2023 extended the standstill period under the CDRC regime for Sapura Energy and its relevant subsidiaries to come to a landing with the MCF financiers for an agreeable debt restructuring solution, up to September 9, 2023.
Meanwhile, Sapura Energy has validated about RM1.5 billion in claims from about 2,000 vendors through its Proof of Debt exercise involving trade creditors. The adjudication phase is almost complete, with only eight claims still being processed.
To address the company's PN17 status, Sapura Energy has appointed MIDF Amanah Investment Bank (MIDF Amanah) as principal adviser to help formulate a regularisation plan to be submitted to Bursa Malaysia.
MIDF Amanah has sought Bursa Malaysia's approval for an extension of time to submit the proposed regularisation plan.
Despite limited working capital and macroeconomic challenges, the company's financial performance showed a marked improvement, recovering from an operating loss of RM2.2 billion in the previous financial year to an operating profit of RM751 million in financial year 2023.
"Despite our financial setbacks, Sapura Energy has managed to maintain its capabilities, significantly enhancing the company's prospects.
"This turnaround will have a positive impact not only on the company, but also our vendors, clients, lenders, and the entire value chain within which we operate," Anuar said.