KUALA LUMPUR (May 24): Serba Dinamik Holdings Bhd (SDHB) has defaulted on its payment for term equity and financing facilities totalling RM14.6 million provided by Public Bank Bhd (PBB) and Public Islamic Bank Bhd (PIBB).
The default by the group's major subsidiary, Serba Dinamik Sdn Bhd (SDSB), was due to cash flows constraint in settling the outstanding payments to the two banks, said Serba Dinamik in a filing with Bursa Malaysia.
SDSB defaulted its payment to PBB on Feb 3, involving an overdraft of RM 528,216 as at Jan 10.
For PIBB, SDSB defaulted its payment for term equity financing-i amounting to RM9,576,806.53, term equity financing-i amounting to RM3,235,442.30 and term equity financing-i amounting to RM1,285,362.13 on Jan 11, 2023.
For PIBB, the subsidiary defaulted its payment for three term equity financing-i as at Jan 8, involving sums of RM9.58 million, RM3.24 million, and RM1.29 million.
Serba Dinamik said the group, along with the appointed liquidator, Victor Saw Seng Kee of PricewaterhouseCoopers Advisory Services Sdn Bhd, has been actively engaging with PBB and PIBB to find a resolution that serves the best interests of the group, SDSB and the banks.
“The company shall endeavour to continue its business and operations despite the default," said the group, adding that it is undertaking several restructuring and cost-cutting measures together with the liquidator in an effort to reduce the cash outflows and improve cash inflows.
“This is part of a greater restructuring and regularisation plan aimed at restoring the company’s status and resolving the financial distress that the company is currently facing,” it added.
Serba Dinamik said PBB and PIBB had initiated legal proceedings to exercise their rights as secured creditors as per the terms of the financing agreements.
In the event of the default of payment, the two banks have charges on several parcels of lands and guarantees in Selangor and Johor Bahru in respect of its secured loan stocks or bonds, said the group
On March 16, the High Court refused to grant a permanent stay of a winding-up petition against Serba Dinamik as well as SDSB and two other subsidiaries. The companies had failed to prove the special circumstances to be granted the stay of winding-up order issued on Jan 10, pending an appeal.
The court had on Jan 10 granted the winding-up application made by the financiers, namely Standard Chartered Saadiq Bhd, HSBC Amanah Malaysia Bhd, AmBank Islamic Bhd, MIDF Amanah Investment Bank Bhd, United Overseas Bank (Malaysia) Bhd and Bank Islam Malaysia Bhd, over the non-payment of loans amounting to RM1.7 billion from the total RM5 billion owed.
Serba Dinamik's share price closed unchanged at two sen on Wednesday (May 24) with a market capitalisation of RM74.5 million.